(Bloomberg) -- TransDigm Group Inc. is offering $3 billion of new debt to fund a special cash divided to shareholders that could reach $4.5 billion.
The package includes a $1.5 billion high-yield bond and a leveraged loan of that size to fund a common-stock special dividend of $3.5 billion to $4.5 billion, the company said. Goldman Sachs Group Inc. is leading both debt sales, according to people familiar with the matter who asked not to be identified as they’re not authorized to speak publicly.
It’s typical for the airplane-parts maker to pay debt-funded special dividends, Bloomberg Intelligence analyst Joel Levington said, calling TransDigm a public company that acts like a private one by tapping the debt market and keeping its leverage around six to seven times Ebitda. Shareholders have benefited, with the stock down just once annually since 2008 (a 1% drop in 2022). It’s climbed 33% so far this year.
TransDigm’s Decision Nearing to Pump $4 Billion Liquidity Well
The offerings are part of a post-Labor Day deluge of debt offerings for both junk-rated firms like TransDigm and investment-grade borrowers. A record 29 high-grade firms were in the market Tuesday with deals.
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