ESAB issues $1 billion in notes to fund Eddyfi Technologies acquisition

ESAB Corporation (NYSE: ESAB) issued $1 billion in 5.625% senior notes due 2031 to help finance its planned $1.45 billion acquisition of Eddyfi Technologies, according to a company statement.

The notes were issued March 26, 2026, and will mature April 1, 2031. ESAB plans to use proceeds from the debt offering, along with funds from new convertible preferred stock and common stock issuances and borrowings under its credit facility, to pay for the acquisition of Eddyfi Technologies, described as a global leader in advanced inspection and monitoring technologies.

The notes will pay interest semi-annually at 5.625% per year on April 1 and October 1, beginning October 1, 2026. They are senior, unsecured obligations guaranteed by certain domestic subsidiaries.

The notes include a special mandatory redemption provision requiring repurchase at 100% of issue price plus accrued interest if the Eddyfi acquisition is not completed by a specified deadline or if the purchase agreement is terminated.

ESAB may redeem the notes at its discretion before April 1, 2028, at 100% of principal plus accrued interest and a make-whole premium. After that date, the company can redeem at specified prices outlined in the indenture.

If ESAB experiences certain changes of control, noteholders may require the company to repurchase their notes at 101% of principal amount plus accrued interest.

The indenture includes covenants restricting ESAB's ability to incur additional debt, create asset liens, guarantee other debt without also guaranteeing the notes, and merge or sell substantially all assets, subject to qualifications and exceptions.

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