RBC Bearings Incorporated Announces Pricing of Common Stock and Mandatory Convertible Preferred Stock Offerings

By: RBC Bearings Incorporated via Business Wire

September 22, 2021 at 06:58 AM EDT

RBC Bearings Incorporated (Nasdaq: ROLL), a leading international manufacturer and marketer of highly engineered precision bearings and products for the industrial, defense and aerospace industries, today announced the pricing of its concurrent public offerings of 3,000,000 shares of common stock, at a public offering price of $185.00 per share, and 4,000,000 shares of Series A Mandatory Convertible Preferred Stock (the “mandatory convertible preferred stock”), at a public offering price of $100.00 per share. The offerings are scheduled to settle on September 24, 2021, subject to customary closing conditions. RBC Bearings also granted the underwriters of the common stock offering a 30-day option to purchase up to an additional 450,000 shares of common stock, and granted the underwriters of the mandatory convertible preferred stock offering a 30-day option to purchase up to an additional 600,000 shares of mandatory convertible preferred stock solely to cover over-allotments. The completion of the common stock offering is not contingent on the completion of the mandatory convertible preferred stock offering, and the completion of the mandatory convertible preferred stock offering is not contingent on the completion of the common stock offering.

RBC Bearings estimates that the net proceeds to it from the offering of common stock will be approximately $526.4 million (or approximately $605.5 million if the underwriters of the common stock offering fully exercise their option to purchase additional shares of common stock), after deducting the underwriting discounts and commissions and estimated offering expenses. RBC Bearings estimates that the net proceeds to it from the offering of mandatory convertible preferred stock will be approximately $387.2 million (or approximately $445.4 million if the underwriters of the mandatory convertible preferred stock offering fully exercise their option to purchase additional mandatory convertible preferred stock), after deducting the underwriting discounts and commissions and estimated offering expenses.

RBC Bearings is conducting the proposed offerings in connection with its financing of its previously announced pending acquisition of the Dodge Mechanical Power Transmission Business (“Dodge”) of ABB Asea Brown Boveri Ltd. RBC Bearings intends to use the net proceeds from the offerings of common stock and mandatory convertible preferred stock to fund a portion of the cash purchase price for the pending acquisition of Dodge, to pay acquisition-related fees and expenses, and for other general corporate purposes.

The mandatory convertible preferred stock will accumulate cumulative dividends at a rate per annum equal to 5.00% on the liquidation preference thereof, which is $100 per share, payable when, as and if declared by RBC Bearings’ board of directors, quarterly in arrears on January 15, April 15, July 15 and October 15 of each year, beginning on January 15, 2022 and ending on, and including, October 15, 2024. Unless previously converted or redeemed, each outstanding share of mandatory convertible preferred stock will automatically convert, for settlement on or about October 15, 2024, into between 0.4413 and 0.5405 shares of RBC Bearings’ common stock, subject to customary anti-dilution adjustments. The preferred stockholders will have the right to convert all or any portion of their shares of mandatory convertible preferred stock at any time before the mandatory conversion date. RBC Bearings will have the right to redeem all, but not less than all, of the mandatory convertible preferred stock if RBC Bearings’ pending acquisition of Dodge has not closed within a specified period of time.

Goldman Sachs & Co. LLC and Wells Fargo Securities, LLC are acting as joint lead book-running managers for the offerings. BofA Securities, Inc., Citigroup Global Markets Inc. and Truist Securities, Inc. are acting as joint book-running managers for the offerings and Citizens Capital Markets, Inc., Fifth Third Securities, Inc., KeyBanc Capital Markets Inc., Regions Securities LLC, Morgan Stanley & Co. LLC, Academy Securities, Inc. and William Blair & Company, L.L.C. are acting as co-managers for the offerings.

Each offering may be made only by means of a prospectus supplement and an accompanying prospectus. RBC Bearings has filed a registration statement (including a prospectus) and preliminary prospectus supplements with the Securities and Exchange Commission (“SEC”) for the offerings to which this press release relates. Before you invest, you should read the applicable preliminary prospectus supplement and the prospectus in that registration statement and other documents RBC Bearings has filed with the SEC for more complete information about RBC Bearings and the offerings. You may obtain these documents free by visiting EDGAR on the SEC’s website at www.sec.gov. Alternatively, RBC Bearings, any underwriter or any dealer participating in the applicable offering will arrange to send you the applicable preliminary prospectus supplement (or, when available, the applicable final prospectus supplement) and the accompanying prospectus upon request. You may also send a request to: Goldman Sachs & Co. LLC, via telephone: (866) 471-2526 or (212) 902-1171, facsimile: (212) 902-9316, email: prospectus-ny@ny.email.gs.com, or standard mail: Goldman Sachs & Co. LLC, 200 West Street, New York, New York 10282, Attention: Prospectus Department; or Wells Fargo Securities, LLC, via standard mail: c/o Equity Syndicate Department, 500 West 33rd Street, New York, New York 10001, telephone: (800) 326-5897, or email: cmclientsupport@wellsfargo.com.

This press release does not constitute an offer to sell, or the solicitation of an offer to buy, any securities referred to in this press release, nor will there be any sale of any such securities, in any state or other jurisdiction in which such offer, sale or solicitation would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction.

About RBC Bearings

RBC Bearings Incorporated is an international manufacturer and marketer of highly engineered precision bearings and components. Founded in 1919, the Company is primarily focused on producing highly technical or regulated bearing products and components requiring sophisticated design, testing and manufacturing capabilities for the diversified industrial, aerospace and defense markets. The Company is headquartered in Oxford, Connecticut.

Forward-Looking Statements

This press release includes forward-looking statements, including statements regarding the completion of the offerings and the pending acquisition of Dodge and the expected amount and intended use of the net proceeds from the offerings. Forward-looking statements represent RBC Bearings’ current expectations regarding future events and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the forward-looking statements. Among those risks and uncertainties are market conditions, the satisfaction of the closing conditions related to the offerings and the pending acquisition of Dodge and risks relating to RBC Bearings’ business, including those described in periodic reports that RBC Bearings files from time to time with the SEC. RBC Bearings may not consummate the offerings or the pending acquisition of Dodge described in this press release and, if the offerings are consummated, cannot provide any assurances regarding its ability to effectively apply the net proceeds as described above. The forward-looking statements included in this press release speak only as of the date of this press release, and RBC Bearings does not undertake to update the statements included in this press release for subsequent developments, except as may be required by law.