MTU Aero Engines launches a new convertible bond offering and solicits offers from investors to sell the outstanding convertible bonds due 2027 (ISIN DE000A2YPE76)

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA, AUSTRALIA, JAPAN, SOUTH AFRICA, CANADA OR ANY OTHER JURISDICTION IN WHICH, OR TO PERSONS IN ANY JURISDICTION TO WHOM, SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

MTU Aero Engines launches a new convertible bond offering and solicits offers from investors to sell the outstanding convertible bonds due 2027 (ISIN DE000A2YPE76)

Munich, 8 January 2026: MTU Aero Engines AG (“MTU” or the “Company”) launches today concurrently the following transactions:

• The offering of senior unsecured convertible bonds in an aggregate principal amount of EUR 600 million, maturing in July 2033 (the "New Convertible Bonds").

• The invitation to holders of MTU’s outstanding senior unsecured convertible bonds due 2027 with an outstanding aggregate nominal amount of EUR 500 million, ISIN DE000A2YPE76 (the "Outstanding Convertible Bonds") to submit offers to sell for cash up to EUR 500 million in aggregate principal amount of Outstanding Convertible Bonds at a fixed purchase price (the "Invitation to Sell").

The contemplated transactions aim to optimise the Company's capital structure through the early refinancing of the Outstanding Convertible Bonds and remove the dilution risk associated with the Outstanding Convertible Bonds. The issue of the New Convertible Bonds will enable MTU to extend its debt maturity profile. The proceeds of the New Convertible Bonds will be used to finance the concurrent repurchase of the Outstanding Convertible Bonds in connection with the Invitation to Sell and for general corporate purposes.

New Convertible Bonds

The New Convertible Bonds will have an aggregate principal amount of EUR 600 million and will be convertible into new and/or existing no-par value ordinary registered shares of the Company (the "Shares"). The Company is using an authorisation from its 2021 annual general meeting for the issuance of the New Convertible Bonds. The existing shareholders’ subscription rights (Bezugsrechte) will be excluded.

The New Convertible Bonds will have a maturity of seven years and six months and will be issued at par in a denomination of EUR 100,000 each. The New Convertible Bonds will bear a coupon between 0.125% and 0.625% per annum, payable semi-annually in arrear. The New Convertible Bonds are expected to be repaid at their accreted redemption amount of 105% of the principal amount, implying a yield to maturity of between 0.77% and 1.26%. The initial conversion price will be set at a conversion premium of between 42.5% and 47.5% above the reference share price (being the volume-weighted average price (“VWAP”) of the Shares on XETRA on 8 January 2026).

The New Convertible Bonds will be offered by way of an accelerated bookbuilding to institutional investors outside the United States of America as well as outside of Australia, Japan, South Africa, Canada and any other jurisdiction in which offers or sales of the Bonds would be prohibited by applicable law.

The final terms of the New Convertible Bonds are expected to be determined and announced through a separate press release later today. Settlement is expected to take place on or around 15 January 2026. The inclusion of the New Convertible Bonds in the open market segment (Freiverkehr) of the Frankfurt Stock Exchange is expected shortly thereafter.

The Company will have the option to redeem the New Convertible Bonds at the Accreted Redemption Amount plus accrued interest in accordance with the terms and conditions of the New Convertible Bonds at any time (i) on or after 29 August 2031 if the parity value of the Shares is equal to or exceeds 130% of the then prevailing Accreted Redemption Amount over a specified period or (ii) if 20% or less of the aggregate principal amount of the New Convertible Bonds originally issued remains outstanding.

In the context of the transaction, the Company will commit to a lock-up of 90 days in respect of the Shares, subject to customary exceptions.

Invitation to Sell

In addition to the proposed offering of the New Convertible Bonds, the Company invites eligible holders of the Outstanding Convertible Bonds to make offers to sell for cash at a fixed purchase price. The Company intends to accept offers to sell up to an amount of EUR 500 million in aggregate principal amount of the Outstanding Convertible Bonds. 

The initial purchase price per EUR 100,000 nominal amount of the Outstanding Convertible Bonds will be 118.30% of the principal amount per Outstanding Convertible Bond tendered under the Invitation to Sell (equal to EUR 118,300 per EUR 100,000 in principal amount of the Outstanding Convertible Bonds), to be delta-adjusted for the difference between today’s VWAP and the closing price of the Shares on XETRA on 7 January 2026 (the “Final Purchase Price”). The Company will pay interest accrued and unpaid on those Outstanding Convertible Bonds accepted for purchase from and including the immediately preceding interest payment date of the Outstanding Convertible Bonds to but excluding the settlement date of the Invitation to Sell, which amounts to EUR 41.64 per Outstanding Convertible Bond.

The Company will have the option to redeem all, but not some only, of the Outstanding Convertible Bonds at the principal amount plus accrued interest, if, at any time, 20% or less of the aggregate principal amount of the Outstanding Convertible Bonds originally issued remains outstanding.

The Invitation to Sell is expected to expire at 5:30 p.m. (CET) on 8 January 2026.

The Final Purchase Price and total number of the Outstanding Convertible Bonds that will be repurchased are expected to be announced today after close of trading on XETRA. Settlement of the Invitation to Sell is expected to be on or around 16 January 2026.

The Company will decide in its sole discretion whether, to what extent and at what price it will repurchase Outstanding Convertible Bonds.

The Invitation to Sell is not being made, directly or indirectly, in or into the United States by use of the mails or by any means or instrumentality (including, without limitation, e-mail, facsimile transmission, telephone and the internet) of interstate or foreign commerce, or of any facility of a national securities exchange of the United States and the Invitation to Sell cannot be accepted by any such use, means, instrumentality or facility or from within the United States. The Invitation to Sell is not open to any persons located or resident in the United States or that are otherwise U.S. Persons (within the meaning of Regulation S under the U.S. Securities Act of 1933, as amended), or persons acting for the account or benefit of any such persons, or in any other jurisdiction where the Invitation to Sell or any participation therein would be unlawful.

BNP PARIBAS, Deutsche Bank and HSBC are acting as Joint Global Coordinators, Joint Bookrunners for the offering of the New Convertible Bonds and as Joint Dealer Managers on the Invitation to Sell.

-END-

--------------------------------------------  About MTU Aero Engines  --------------------------------

MTU Aero Engines AG is a globally recognized expert in commercial and military aircraft engines. MTU‘s high-tech expertise ranges from the development and production of high-quality components to the final assembly of complete engines and the maintenance of aircraft engines and stationary gas turbines. In the financial year 2024, the DAX-listed company generated revenues of 7.5 billion euros. MTU technology can be found providing reliable thrust in one in three commercial aircraft worldwide. And every year, MTU maintains around 1,500 engines and industrial gas turbines. At 19 locations on five continents, more than 13,000 employees from over 80 nations contribute to safe global mobility. Together with other European engine manufacturers, MTU has also been ensuring and supporting the operational readiness of air forces for decades. To continue to benefit from the sustained growth of the aviation industry in the years to come, the company is investing in its expertise, industrial capacities and in future commercial and military engine concepts in Germany and worldwide. With the passion and innovative strength of its employees, MTU is shaping modern aviation – today, tomorrow and in the decades to come.

www.mtu.de   |   MTU Aero Engines   |   mtu_aero_engines   |   MTU Aero Engines

-------------------------------------------------------  Contact  --------------------------------------------

Markus Wölfle | Director Corporate Communications | +49 (0) 151-174-150 84 | markus.woelfle@mtu.de

Eva Simon | Press Officer Finance | +49 (0) 176-1008 4162 | eva.simon@mtu.de

-------------------------------------------------  Important Notice  -------------------------------------

This announcement and the information contained herein is restricted and may not be published, distributed or released, directly or indirectly, in the United States of America (including its territories and possessions), Australia, Canada, South Africa, Japan or any other jurisdiction where such publication, distribution or release would be unlawful. The publication, distribution or release of this announcement may be restricted by law in certain jurisdictions and persons who are in possession of this document or other information referred to herein should inform themselves about and observe any such restrictions. Further, this announcement is for information purposes only and is not an offer of, or a solicitation of an offer to purchase, sell or subscribe for, securities in any jurisdiction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. This announcement has not been approved by the Frankfurt Stock Exchange.

This announcement is an advertisement within the meaning of Regulation (EU) 2017/1129, as amended (the "EU Prospectus Regulation") and the Regulation (EU) 2017/1129 as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018 (the "EUWA") (the "UK Prospectus Regulation"), and does not constitute an offer of, or a solicitation of an offer to purchase, sell or subscribe for, any securities of the Company or of any of its subsidiaries in the United States of America, Australia, Canada, Japan or any other jurisdiction in which offers of, or a solicitation of an offer to purchase, sell or subscribe for, securities would be prohibited by applicable law. Neither this announcement nor anything contained herein shall form the basis of, or be relied upon in connection with, an offer or offer to purchase, sell or subscribe in any jurisdiction. The New Convertible Bonds offered or offered to be purchased, sold or subscribed for will not be and have not been registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") or with any securities regulatory authority of any state or other jurisdiction of the United States and may not be offered, sold, pledged, taken up, exercised, resold, renounced, transferred or delivered, directly or indirectly, in or into the United States, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the United States. The securities referred to herein have not been approved, disapproved or recommended by the U.S. Securities and Exchange Commission, any state securities commission in the United States or any other U.S. regulatory authority, nor have any of the foregoing authorities passed upon or endorsed the merits of the offering of the securities referred to herein. No public offering of, or solicitation of an offer to purchase, sell or subscribe for, securities of the Company is being made in the United States or any such other jurisdiction.

No reliance may be placed for any purpose on the information contained in this announcement or its accuracy or completeness. No prospectus will be prepared in connection with the offering of, or solicitation of an offer to purchase, sell or subscribe for, the securities referred to herein. The securities referred to herein may not be offered, and no solicitation of an offer to purchase, sell or subscribe for, such securities may be made, to the public in any jurisdiction in circumstances which would require the preparation or registration of any prospectus or offering document relating to the securities referred to herein in such jurisdiction.

In the United Kingdom, this announcement is only directed at "qualified investors" within the meaning of the UK Prospectus Regulation who (i) are investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the "Order") or (ii) are persons falling within Article 49(2)(a) to (d) of the Order (high net worth companies, unincorporated associations, etc. (all such persons together being referred to as "Relevant Persons")). This document must not be acted on, or relied upon, by persons who are not Relevant Persons. Any investment or investment activity to which this document relates is available only to Relevant Persons and will be engaged in only with Relevant Persons.

In member states of the European Economic Area the placement of, and invitation to submit any offer to purchase, sell or subscribe for, any securities described in this announcement is directed exclusively at persons who are "qualified investors" within the meaning of the Regulation (EU) 2017/1129, as amended.

MIFID II: Solely for the purposes of the EEA manufacturer's product approval process, contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of commission delegated directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the target market assessment in respect of the New Convertible Bonds has led to the conclusion that: (i) the target market for the New Convertible Bonds is eligible counterparties and professional clients only, each as defined in MiFID II; and (ii) all channels for distribution of the New Convertible Bonds to eligible counterparties and professional clients are appropriate. Any person subsequently offering, selling or recommending the New Convertible Bonds (a "distributor") should take into consideration the manufacturer's target market assessment; however, a distributor subject to MiFID II is responsible for undertaking its own target market assessment in respect of the New Convertible Bonds (by either adopting or refining the manufacturer's target market assessment) and determining appropriate distribution channels.

The target market assessment is without prejudice to the requirements of any contractual or legal selling restrictions in relation to any offering of the securities. For the avoidance of doubt, the target market assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any action whatsoever with respect to the New Convertible Bonds.

The New Convertible Bonds are not intended to be offered, sold or otherwise made available to and should not be offered, sold or otherwise made available to any retail investor in the EEA or the United Kingdom (the "UK"). For these purposes, a "retail investor" means (a) in the EEA, a person who is one (or more) of: (i) a retail client as defined in point (11) of Article 4(1) of MiFID II; (ii) a customer within the meaning of Directive (EU) 2016/97 (as amended, the "Insurance Distribution Directive"), where that customer would not qualify as a professional client as defined in point (10) of article 4(1) of MiFID II, and (b) in the UK, a person who is one (or more) of (i) a retail client within the meaning of Regulation (EU) no 2017/565 as it forms part of UK domestic law by virtue of the EUWA or (ii) a customer within the meaning of the provisions of the Financial Services and Markets Act 2000 of the UK (the "FSMA") and any rules or regulations made under the FSMA to implement Directive (EU) 2016/97, where that customer would not qualify as a professional client, as defined in point (8) of Article 2(1) of regulation (EU) No 600/2014 as it forms part of UK domestic law by virtue of the EUWA.

Consequently, no key information document required by Regulation (EU) No 1286/2014 (the "EU PRIIPs Regulation") or the EU PRIIPS Regulation as it forms part of UK domestic law by virtue of the EUWA (the "UK PRIIPs Regulation") for offering or selling the New Convertible Bonds or otherwise making them available to retail investors in the EEA or the UK has been prepared and therefore offering or selling the New Convertible Bonds or otherwise making them available to any retail investor in the EEA or the UK may be unlawful under the EU PRIIPs Regulation and/or the UK PRIIPs Regulation.

No action has been taken that would permit an offering or an acquisition of, or a solicitation of an offer to purchase, sell or subscribe for, the securities or a distribution of this announcement in any jurisdiction where such action would be unlawful. Persons into whose possession this announcement comes are required to inform themselves about and to observe any such restrictions.

This announcement does not constitute a recommendation or advice concerning the placement of, or invitation to submit any offer to purchase, sell or subscribe for, any securities. Investors should consult a professional advisor as to the suitability of the placement of, or invitation to submit any offer to purchase, sell or subscribe for, any securities for the person concerned.

This announcement may contain forward looking statements, estimates, opinions and projections with respect to anticipated future performance of the Company ("forward-lookingf statements"). These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "targets", "plans", "aims", "projects", "believes", "estimates", "anticipates", "expects", "intends", "may", "will", "would", "could" or "should" or, in each case, their negative, or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. Forward-looking statements are based on the current views, expectations and assumptions of the management of the Company and involve significant known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Forward-looking statements should not be read as guarantees of future performance or results and will not necessarily be accurate indications of whether or not such results will be achieved. Any forward-looking statements included herein only speak as at the date of this release. We undertake no obligation, and do not expect to publicly update, or publicly revise, any of the information, forward-looking statements or the conclusions contained herein or to reflect new events or circumstances or to correct any inaccuracies which may become apparent subsequent to the date hereof, whether as a result of new information, future events or otherwise. We accept no liability whatsoever in respect of the achievement of such forward-looking statements and assumptions.

The Joint Bookrunners are acting exclusively for the Company and no-one else in connection with the Offering. They will not regard any other person as their respective clients in relation to the Offering and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients, nor for providing advice in relation to the Offering, the contents of this announcement or any transaction, arrangement or other matter referred to herein.

In connection with the Offering of the New Convertible Bonds, the Joint Bookrunners and any of their affiliates may take up a portion of the New Convertible Bonds in the Offering and/or may acquire ordinary shares as a principal position and in that capacity may retain, purchase, sell, offer to sell for their own accounts such New Convertible Bonds, ordinary shares and other securities of the Company or its group or related investments in connection with the Offering or otherwise. In addition, the Joint Bookrunners and any of their affiliates may enter into financing arrangements (including swaps, warrants or contracts for differences) with investors in connection with which the Joint Bookrunners and any of their affiliates may from time to time acquire, hold or dispose of New Convertible Bonds ordinary shares and/or other securities or derivate positions in such securities. The Joint Bookrunners and their affiliates do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

None of the Joint Bookrunners or any of their respective directors, officers, employees, affiliates, advisers or agents accepts any responsibility or liability whatsoever for or makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or any other information relating to the Issuer, its subsidiaries or associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of this announcement or its contents or otherwise arising in connection therewith.