May 31, 2001

Navistar Issues $400 Million in Senior Notes as Debt Offering Is Oversubscribed

WARRENVILLE, Ill., May 31 -- Navistar International Corporation (NYSE: NAV) announced today that its private placement of a new debt issue was oversubscribed and, as a result, the company has issued $400 million of five-year senior notes.

Initially, the company had planned to raise $300 million, which was to be used for debt repayment, to fund ongoing capital development programs and for general corporate purposes. The new notes were sold in a 144A offering and are priced to yield 9.375 percent.

John R. Horne, Navistar chairman, president and chief executive officer, said the over subscription is a clear reflection of the confidence that the investment community has in the programs and plans that the company is putting in place to assure future growth and to achieve its vision to become the best truck and engine company.

"Our company is on the move. Already this year we have announced the most significant joint venture in our history, held the biggest new product introduction in the past 25 years and finalized the acquisition of the largest diesel engine company in South America," Horne said. "Next week we will open our new integrated school bus plant in Tulsa, Okla. and we are preparing our next generation of clean diesel engines for production later this year. "

In February, Navistar and Ford Motor Company announced that they intend to form a joint venture to build commercial trucks in Mexico and distribute service parts. The two companies will also develop new products as well as explore opportunities for greater cooperation in diesel engines for potential applications in Ford's full range of truck products. Also in February, the company introduced the industry's first High Performance truck with new models scheduled to roll out every few months over the next two years. The company also completed the arrangements to become the sole owner of Maxion International Motores, which produces a full line of diesel engines for use by original equipment manufacturers.

J.P. Morgan Securities Inc. and Credit Suisse First Boston were joint book-running managers of the private placement.

The securities offered have not been registered under the Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

Navistar International Corporation (NYSE: NAV) is the parent company of International Truck and Engine Corporation, a leading producer of mid-range diesel engines, medium trucks, school buses, heavy trucks, severe service vehicles, and parts and service sold under the International® brand. The company also is a private label designer and manufacturer of diesel engines for the pickup truck, van and SUV markets. With world headquarters in Warrenville, a suburb of Chicago, Navistar had 2000 sales and revenues of $8.5 billion. Additional information can be found on the company's web site at http://www.internationaldelivers.com .


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