Dell Technologies Inc. (DELL, Financial) has successfully completed a public offering of senior notes, raising a total of $1.5 billion. The offering, which took place on October 8, 2024, involved two wholly-owned subsidiaries of Dell Technologies, Dell International L.L.C. and EMC Corporation, collectively referred to as the Issuers.
The issuance includes $700 million in 4.350% Senior Notes due 2030 and $800 million in 4.850% Senior Notes due 2035. These notes were sold under a shelf registration statement on Form S-3ASR, and are senior unsecured obligations, ranking equally with all existing and future senior indebtedness of the Issuers.
The notes are guaranteed on a joint and several basis by Dell Technologies and its wholly-owned subsidiaries, Denali Intermediate Inc. and Dell Inc. The guarantees are senior in right of payment to all future subordinated indebtedness of the Guarantors.
Interest on the 2030 Notes accrues at 4.350% per annum, while the 2035 Notes accrue interest at 4.850% per annum. Both series of notes will have interest payments made semi-annually, starting February 1, 2025. The 2030 Notes will mature on February 1, 2030, and the 2035 Notes will mature on February 1, 2035.
The Issuers have the option to redeem the notes prior to maturity under specific conditions, including a "make-whole" premium. Additionally, in the event of a change of control, noteholders may require the Issuers to repurchase the notes at 101% of the principal amount, plus accrued interest.
The indenture governing the notes includes covenants that limit the creation of liens, consolidation, mergers, and sale or leaseback transactions, among other restrictions. These covenants are typical for issuers of investment-grade debt securities.
This strategic move by Dell Technologies aims to bolster its financial flexibility and support its long-term growth objectives. For more detailed information, the full text of the indentures and related legal opinions are available in the company's Form 8-K filing.
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