Autoliv Completes Successful Remarketing; Reduces Interest Expense by $11 Million

Autoliv, Inc.

announced today that it has completed the remarketing of its 8% senior notes due on April 30, 2014. Following significant interest from investors, the coupon of the Senior Notes was reset to 3.854% with a yield of 2.875%. This new interest rate becomes effective today, March 15, 2012, and will save Autoliv around $11 million in interest expense in 2012 compared to 2011. The Senior Notes were originally issued as components of the equity units that Autoliv issued on March 30, 2009. The remarketing reset the interest on $106 million of debt while the maturity date remains at April 30, 2014. The remarketing activity is expected to reduce Autoliv's cost of borrowing by around $11 million during 2012 compared to 2011 and incrementally by around another $1 million in 2013. This is expected to improve earnings per share by around 7 cents (assuming dilution) in 2012. The proceeds from the remarketing have been used to purchase a portfolio U.S. Treasury securities that will serve as collateral to secure the stock purchase obligations of the holders of the equity units. On April 30, 2012, Autoliv will issue shares to settle the purchase contracts. As a result, Autoliv's net cash position will increase by approximately $106 million on that date and outstanding shares will increase by 5.8 million to approximately 95.2 million shares.