Rolls-Royce Holdings plc (the “"Company" and together with its subsidiaries, the “Group” or “Rolls-Royce”) announces that it has successfully priced an offering (the “Bond Offering”) of three tranches of senior unsecured notes denominated in US dollars, euros and sterling (collectively, the "Notes") to raise gross proceeds of approximately £2 billion. The Notes will be issued by Rolls-Royce plc and guaranteed by the Company.

The Bond Offering comprises:

• USD 1,000 million¹ aggregate principal amount of 5.750% Notes due 2027;
• EUR 750 million² aggregate principal amount of 4.625% Notes due 2026; and
• GBP 545 million aggregate principal amount of 5.750% Notes due 2027.

On 1 October 2020, we announced our intention to raise gross proceeds of at least £1 billion through a bond offering, as part of a proposed £5 billion recapitalisation package to increase resilience, strengthen the balance sheet and support long-term strategy. Given the strong demand from investors for the Notes, we decided to increase the size of the offering of the Notes issued to approximately £2 billion equivalent.

The recapitalisation package also includes an approximately £2 billion fully underwritten rights issue (the “Rights Issue”) and commitments for a new two-year term loan facility of £1 billion. The combination of the proceeds from the Notes, the Rights Issue and the commitments for the new £1 billion term loan facility is expected to provide us with gross proceeds of approximately £5 billion.

As previously announced on 1 October, we have also received support in principle from UK Export Finance for an extension of its 80% guarantee to support a potential increase of up to £1 billion to our existing £2 billion five-year term loan facility. However, given the increase in the quantum of Notes being issued, we do not currently plan to progress this potential extension to our loan facility, while still having the option to do so at a later time if required.

The Bond Offering is expected to close on 21 October 2020 and the proceeds will be escrowed and will be available to Rolls-Royce upon successful completion of its Rights Issue.

¹USD 1,000 million is equivalent to GBP 772 million. USD converted to GBP at 1.2953:1 based on the exchange rate on 14^th October 2020 at 11.30am BST.
²EUR 750 million is equivalent to GBP 680 million. EUR converted to GBP at 1.1037:1 based on the exchange rate on 14^th October 2020 at 11.30am BST.