BorgWarner Launches Cash Tender Offers for Senior Notes Worth Up to $720 Million
The automotive supplier is targeting multiple series of senior notes in what it describes as a balanced capital allocation strategy to grow long-term earnings.
Tender Offer Details
BorgWarner Inc. (NYSE: BWA) announced on August 10, 2026, that it has commenced cash tender offers to purchase multiple series of its outstanding senior notes, describing the move as "a balanced capital allocation strategy intended to grow the long-term earnings of the Company" (8-K filing, 2026-08-10).
The tender offers consist of two components: an "any and all" offer for the company's 7.125% Senior Notes due 2029, and separate offers for four additional series of notes with a combined cap of $720 million, excluding accrued interest (8-K filing, 2026-08-10). The waterfall offers include the company's 2.650% notes due 2027, subject to a sub-cap of $250 million.
Priority Structure and Timeline
The company will accept waterfall notes for purchase according to a priority ranking system, with acceptance levels ranging from 1 to 4 (8-K filing, 2026-08-10). If proration is required for any series, BorgWarner will multiply the principal amount of each valid tender by the applicable proration rate and round down to the nearest $1,000 increment.
The tender offers are set to expire at 5:00 p.m. New York time on August 14, 2026, with a settlement date expected for August 18, 2026 (8-K filing, 2026-08-10). Notes may be withdrawn at any time prior to the expiration date.
Redemption Backstop
For the 7.125% notes, BorgWarner intends to deliver a notice of redemption to The Bank of New York Mellon on August 10, 2026, to redeem any remaining outstanding notes on September 9, 2026, if the company purchases less than all of them in the tender offer (8-K filing, 2026-08-10). The redemption would occur at a make-whole price pursuant to the 1999 indenture governing those notes, plus accrued interest.
Tender Consideration
The tender consideration for each series will be determined based on a fixed spread plus a reference yield as quoted on Bloomberg at 3:00 p.m. New York time on August 14, 2026 (8-K filing, 2026-08-10). All holders whose notes are accepted will receive the tender consideration plus accrued and unpaid interest from the last interest payment date through the settlement date.
Barclays Capital Inc. and PNC Capital Markets LLC are serving as dealer managers for the offers, while Global Bondholder Services Corporation is acting as tender and information agent (8-K filing, 2026-08-10).
Conditions and Flexibility
The tender offers are not contingent upon any minimum principal amount being tendered, and none of the offers is conditioned on consummation of the others (8-K filing, 2026-08-10). The company reserves the right to waive conditions, extend or terminate any offer, or amend the terms, subject to applicable law. BorgWarner may also increase the amount of waterfall notes accepted by up to 2% of the outstanding notes of any applicable series without amending or extending the offer.
According to MarginX data, BorgWarner is scheduled to present at the J.P. Morgan Automotive Conference on August 12, 2026, and has a quarterly dividend of $0.17 per share payable on September 1, 2026. The company carries a market capitalization of approximately $14 billion.
This article was generated by MarginX from the 8-K filing on 2026-08-10. It is not investment advice.