v3.26.1
Debt
 3 Months Ended
Jun. 30, 2026
Debt Disclosure [Abstract]  
6. DEBT
6. DEBT
Debt consists of the following:
June 30, 2026March 31, 2026
in millions
Interest Rates(1)
Principal
Unamortized Carrying 
Value Adjustments(2)
Carrying ValuePrincipal
Unamortized Carrying
Value Adjustments(2)
Carrying Value
Short-term borrowings4.76 %$2,284 $— $2,284 $1,305 $— $1,305 
Floating rate Term Loans, due March 20325.48 %1,234 (13)1,221 1,238 (14)1,224 
3.25% Senior Notes, due November 2026
3.25 %13 — 13 13 — 13 
3.375% Senior Notes, due April 2029
3.375 %572 (4)568 576 (5)571 
4.75% Senior Notes, due January 2030
4.75 %1,600 (11)1,589 1,600 (12)1,588 
6.875% Senior Notes, due January 2030
6.875 %750 (8)742 750 (9)741 
3.875% Senior Notes, due August 2031
3.875 %750 (6)744 750 (6)744 
6.375% Senior Notes, due August 2033
6.375 %750 (10)740 750 (11)739 
China Bank Loans, due August 20272.65 %29 — 29 29 — 29 
China Loan, due September 20272.45 %15 — 15 14 — 14 
China Loan, due November 20272.60 %22 — 22 22 — 22 
China Loan, due December 20272.50 %22 — 22 22 — 22 
China Loan, due January 20292.40 %27 — 27 26 — 26 
Sierre Loan, due October 20270.46 %124 — 124 125 — 125 
Series 2025A Bonds, due June 2032(3)
5.00 %400 (5)395 400 (5)395 
Series 2025B Bonds, due June 2032(3)
4.625 %100 (2)98 100 (2)98 
Series 2026A Bonds, due March 2033(4)
4.30 %225 (4)221 225 (4)221 
Finance lease obligations and other debt, due through April 2040(5)
4.54 %53 — 53 33 — 33 
Total debt$8,970 $(63)$8,907 $7,978 $(68)$7,910 
Less: Short-term borrowings
(2,284)— (2,284)(1,305)— (1,305)
Less: Current portion of long-term debt
(56)— (56)(54)— (54)
Long-term debt, net of current portion$6,630 $(63)$6,567 $6,619 $(68)$6,551 
____________________
(1)Interest rates are the stated rates of interest on the debt instrument (not the effective interest rate) as of June 30, 2026, and therefore exclude the effects of related interest rate swaps and accretion and amortization of debt issuance costs related to refinancing transactions and additional borrowings. We present stated rates of interest because they reflect the rate at which cash will be paid for future debt service, except for the Sierre loan, for which interest is assessed in arrears.
(2)Amounts include unamortized debt issuance costs, fair value adjustments, and debt discounts.
(3)The Series 2025A Bonds and Series 2025B Bonds, as defined below, accrue interest at a fixed annual rate of 5% and 4.625%, respectively, ending with a mandatory tender for purchase on June 1, 2032. The Series 2025A and Series 2025B Bonds will mature on June 1, 2055.
(4)The Series 2026A Bonds, as defined below, accrue interest at a fixed annual rate of 4.3%, ending with a mandatory tender for purchase on March 1, 2033. The Series 2026A Bonds will mature on March 1, 2056.
(5)During the three months ended June 30, 2026, Novelis added $21 million of new finance leases.
Principal repayment requirements for our total debt over the next five years and thereafter using exchange rates as of June 30, 2026, for our debt denominated in foreign currencies are as follows (in millions):
As of June 30, 2026
Amount
Short-term borrowings and current portion of long-term debt due within one year$2,340 
2 years90 
3 years741 
4 years2,368 
5 years17 
Thereafter3,414 
Total$8,970 
Short-Term Borrowings
As of June 30, 2026, our short-term borrowings totaled $2.3 billion, which consisted of $1.9 billion of borrowings on our ABL Revolver (as defined below), $350 million in short-term Brazil loans, and $14 million in short-term China loans (CNY 92 million).
The weighted average interest rate on the short-term borrowings was 4.76% and 4.72% as of June 30, 2026, and March 31, 2026, respectively.
Term Loan Facility
In March 2025, we entered into a secured term loan credit facility (the "Term Loan Facility"). The Term Loan Facility provided Novelis with $1.25 billion of proceeds (the "2025 Term Loans"). The proceeds of the 2025 Term Loans were used to repay $741 million and $481 million of the previously issued term loans due September 2026 and March 2028, respectively, with the remaining balance for general corporate purposes and transaction-related expenses. We incurred debt issuance costs of $16 million for the 2025 Term Loans, which will be amortized as an increase to interest expense and amortization of debt issuance costs over the term of the loan. The 2025 Term Loans mature on March 11, 2032, and are subject to 0.25% quarterly amortization payments.
On September 15, 2025, we amended the Term Loan Facility to, among other things, reduce the interest rate from three-month Term SOFR, plus 2.00%, to three-month Term SOFR, plus 1.75%, with interest continuing to be payable at the end of each three-month interest period. In accordance with ASC 470, Debt, the amendment was accounted for as a partial extinguishment of the Term Loan Facility, whereby $65 million was deemed an extinguishment and $1.18 billion was deemed a modification of debt. As a result of this transaction, we recorded a loss on extinguishment of debt of $2 million in the second quarter of fiscal 2026.
As of June 30, 2026, we were in compliance with the covenants of our Term Loan Facility.
ABL Revolver
On February 19, 2026, the Company amended the ABL Revolver facility (the "ABL Revolver") to increase the maximum availability under the ABL Revolver by $500 million to an aggregate total of $2.5 billion. All other material terms of the ABL Revolver remained unchanged as a result of this amendment.
On June 16, 2026, the Company amended the ABL Revolver to increase the maximum availability under the ABL Revolver by an additional $500 million, bringing availability to an aggregate total of $3.0 billion and to extend the maturity until June 16, 2031. Additionally, this amendment also made certain changes to the ABL Revolver that gave the Company additional flexibility to operate its business. As a result of this debt modification, the Company incurred $8 million of financing fees, which will be amortized over the term of the loan.
As of June 30, 2026, we were in compliance with the covenants for our ABL Revolver.
As of June 30, 2026, we had $1.9 billion in borrowings under the ABL Revolver. We utilized $205 million of the ABL Revolver for letters of credit. We had availability of $875 million on the ABL Revolver, including $70 million of remaining availability that can be utilized for letters of credit.
Citi Facility
On August 14, 2025, the Company entered into an Uncommitted Trade Loan Facility Agreement with Citibank, which was amended in January 2026 (as amended, the "Citi Facility"). The Citi Facility provides for an uncommitted revolving facility for loans and advances of up to an aggregate amount of $300 million. The initial maximum term of each individual loan or advance is 30 days. Borrowings under the Citi Facility bear interest at Term SOFR plus a margin of 1.00%.
As of June 30, 2026, we had no outstanding borrowings under the Citi Facility.
MUFG Facility
On May 26, 2026, the Company entered into an Uncommitted Facility Agreement (the "MUFG Facility") with MUFG Bank, Ltd., GIFT Branch providing for an uncommitted revolving facility for loans and advances of up to an aggregate amount of $500 million. Advances under the MUFG Facility may be denominated in U.S. dollars or euros, subject to a euro sublimit of €200 million. The initial maximum term of each individual loan or advance is through the last business day of the calendar month in which such loan or advance is made. Individual loans or advances may be rolled over up to two times, but no loan or advance may mature later than 90 days after the date the original advance was made. Borrowings under the MUFG Facility bear interest at Term SOFR or EURIBOR, as applicable, plus a margin of 1.15%.
As of June 30, 2026, we had no outstanding borrowings under the MUFG Facility.
Senior Notes
Our 3.250% Senior Notes due November 2026, 3.375% Senior Notes due April 2029, 4.750% Senior Notes due January 2030, 3.875% Senior Notes due August 2031, 6.875% Senior Notes due January 2030, and 6.375% Senior Notes due August 2033 (the "Senior Notes") are guaranteed, jointly and severally, on a senior unsecured basis, by Novelis Inc. and certain of its subsidiaries. The Senior Notes contain customary covenants and events of default that will limit our ability and, in certain instances, the ability of certain of our subsidiaries to incur additional debt and provide additional guarantees; pay dividends or return capital beyond certain amounts and make other restricted payments; create or permit certain liens; make certain asset sales; use the proceeds from the sales of assets and subsidiary stock; create or permit restrictions on the ability of certain of Novelis' subsidiaries to pay dividends or make other distributions to Novelis or certain of Novelis' subsidiaries, as applicable; engage in certain transactions with affiliates; enter into sale and leaseback transactions; designate subsidiaries as unrestricted subsidiaries; and consolidate, merge, or transfer all or substantially all of our assets and the assets of certain of our subsidiaries. During any future period in which either Standard & Poor's Ratings Group, Inc. or Moody's Investors Service, Inc. have assigned an investment grade credit rating to the Senior Notes and no default or event of default under the indenture has occurred and is continuing, certain of the covenants will be suspended. The Senior Notes include customary events of default, including a cross-acceleration event of default. The Senior Notes also contain customary call protection provisions for our bondholders that extend through November 2023 for the 3.250% Senior Notes due November 2026 (the "2026 Senior Notes"), through April 2024 for the 3.375% Senior Notes due April 2029, through January 2025 for the 4.750% Senior Notes due January 2030, through August 2026 for the 3.875% Senior Notes due August 2031, through January 2027 for the 6.875% Senior Notes due January 2030, and through August 2028 for the 6.375% Senior Notes due August 2033 (the "2033 Senior Notes").
As of June 30, 2026, we were in compliance with the covenants of our Senior Notes.
2033 Senior Notes and Cash Tender Offer for the 2026 Senior Notes
On August 18, 2025, Novelis Corporation, a wholly owned subsidiary of Novelis Inc., issued $750 million in aggregate principal amount of the 2033 Senior Notes. The 2033 Senior Notes will mature on August 15, 2033 and are subject to semi-annual interest payments that will accrue at a rate of 6.375% per year. Concurrently with the offering, Novelis conducted a cash tender offer for any and all of the outstanding 2026 Senior Notes (the "Tender Offer"). The net proceeds of the offering were used to (i) purchase $737 million of the $750 million outstanding aggregate principal amount of the 2026 Senior Notes that were validly tendered and not withdrawn pursuant to the Tender Offer and (ii) pay fees and expenses in connection with the offering and the Tender Offer. We incurred original issue discount costs of $9 million and debt issuance costs of $3 million related to the 2033 Senior Notes, which are amortized as an increase to interest expense and amortization of debt issuance costs over the term of the note.
China Bank Loans
In September 2019, we entered into a credit agreement with the Bank of China to provide up to CNY 500 million in unsecured loans to support certain capital expansion projects in China. As of June 30, 2026, and March 31, 2026, we had $29 million (CNY 200 million) of borrowings on our China bank loans.
China Loans
In the second quarter of fiscal 2025, we borrowed CNY 100 million of bank loans. The China Loan, due September 2027 matures on September 20, 2027, is subject to monthly interest payments, and accrues interest at China Loan Prime Rate less 0.55%. The loan amount is due in full at the maturity date. As of June 30, 2026, and March 31, 2026, we had $15 million (CNY 100 million) and $14 million (CNY 100 million), respectively, of borrowings on our loan.
In the third quarter of fiscal 2025, we borrowed CNY 150 million of bank loans. The China Loan, due November 2027 matures on November 20, 2027, is subject to monthly interest payments, and accrues interest at China Loan Prime Rate less 0.40%. The loan amount is due in full at the maturity date. As of June 30, 2026, and March 31, 2026, we had $22 million (CNY 149 million) of borrowings on our loan.
Additionally, in the third quarter of fiscal 2025, we borrowed CNY 150 million of bank loans. The China Loan, due December 2027 matures on December 16, 2027, is subject to quarterly interest payments, and accrues interest at China Loan Prime Rate less 0.50%. The loan amount is subject to annual principal payments determined by the debt agreement, with the final payment due at the maturity date. As of June 30, 2026, and March 31, 2026, we had $22 million (CNY 149 million) of borrowings on our loan.
In the fourth quarter of fiscal 2026, we borrowed CNY 180 million of bank loans. The China Loan, due January 2029 matures on January 26, 2029, is subject to monthly interest payments, and accrues interest at China Loan Prime Rate less 0.60%. The loan amount is subject to annual principal payments determined by the debt agreement, with the final payment due at the maturity date. As of June 30, 2026, and March 31, 2026, we had $27 million (CNY 180 million) and $26 million (CNY 180 million), respectively, of borrowings on our loan.
Sierre Loan
In the third quarter of fiscal 2025, we borrowed CHF 100 million from the Banque Cantonale du Valais in order to fund the recovery of our Sierre facility after it flooded in June 2024 (the "Sierre Loan"). The Sierre Loan will mature on October 29, 2027, is subject to quarterly interest payments, and accrues interest at the Swiss Average Rate Overnight plus a spread of 0.50%. The loan amount is due in full at the maturity date. All interest on the Sierre Loan is payable by the Canton of Valais, the local Swiss governmental body where the Sierre facility is located, as part of the Canton’s post-flood recovery efforts in the area. As of June 30, 2026, and March 31, 2026, we had $124 million (CHF 100 million) and $125 million (CHF 100 million), respectively, of borrowings on our loan.
Series 2025A Bonds
In June 2025, Novelis Corporation announced the issuance of $400 million in original aggregate principal amount of tax-exempt bonds (the "Series 2025A Bonds") by the Industrial Development Authority of Baldwin County (the "Baldwin IDA"). The Series 2025A Bonds were issued at par. Novelis Corporation received all net proceeds related to the issuance during the first quarter of fiscal 2026. The proceeds from the Series 2025A Bonds were loaned to Novelis Corporation pursuant to a loan agreement (the "Series 2025A Loan Agreement") with the Baldwin IDA, and were used to finance a portion of the costs of the construction of the Bay Minette plant. In connection with this transaction, we incurred debt issuance costs of $6 million, which are amortized as an increase to interest expense and amortization of debt issuance costs over the term of the loan. The Series 2025A Bonds are guaranteed, jointly and severally, on a senior unsecured basis, by Novelis Inc. and certain of its subsidiaries.
The Series 2025A Bonds bear interest at 5.00% per annum, ending with a mandatory tender for purchase on June 1, 2032 (the "Mandatory Tender Date"). After the end of the initial term interest rate period on the Mandatory Tender Date, the Series 2025A Bonds may be converted to a variable (daily or weekly) interest rate period or may remain in a term interest rate period of the same or different duration. If the rate is converted to a variable rate, the interest rate will be reset at the end of each interest rate period. The Series 2025A Bonds will mature on June 1, 2055. The Company will make semiannual interest payments on the outstanding principal on January 15 and July 15 of each year, with the first such interest payment due on January 15, 2026. The Series 2025A Loan Agreement contains standard representations, covenants and events of default for transactions of this type.
As of June 30, 2026, we were in compliance with the covenants under the Series 2025A Loan Agreement.
Series 2025B Bonds
In September 2025, Novelis Corporation announced the issuance of $100 million in original aggregate principal amount of tax-exempt bonds (the "Series 2025B Bonds") by the Baldwin IDA. The Series 2025B Bonds were issued at par. Novelis Corporation received all net proceeds related to the issuance during the second quarter of fiscal 2026. The proceeds from the Series 2025B Bonds were loaned to Novelis Corporation pursuant to a loan agreement (the "Series 2025B Loan Agreement") with the Baldwin IDA, and were used to finance a portion of the costs of the Bay Minette plant. In connection with this transaction, we incurred debt issuance costs of $2 million, which are amortized as an increase to interest expense and amortization of debt issuance costs over the term of the loan. The Series 2025B Bonds are guaranteed, jointly and severally, on a senior unsecured basis, by Novelis Inc. and certain of its subsidiaries.
The Series 2025B Bonds bear interest at 4.625% per annum, ending with a mandatory tender for purchase on the Mandatory Tender Date (as defined above). After the end of the initial term interest rate period on the Mandatory Tender Date, the Series 2025B Bonds may be converted to a variable (daily or weekly) interest rate period or may remain in a term interest rate period of the same or different duration. If the rate is converted to a variable rate, the interest rate will be reset at the end of each interest rate period. The Series 2025B Bonds will mature on June 1, 2055. The Company will make semiannual interest payments on the outstanding principal on January 15 and July 15 of each year, with the first such interest payment due on January 15, 2026. The Series 2025B Loan Agreement contains standard representations, covenants and events of default for transactions of this type.
As of June 30, 2026, we were in compliance with the covenants under the Series 2025B Loan Agreement.
Series 2026A Bonds
In March 2026, Novelis Corporation announced the issuance of $225 million in original aggregate principal amount of tax-exempt bonds (the "Series 2026A Bonds") by the Baldwin IDA. The Series 2026A Bonds were issued at par. Novelis Corporation received all net proceeds related to the issuance during the fourth quarter of fiscal 2026. The proceeds from the Series 2026A Bonds were loaned to Novelis Corporation pursuant to a loan agreement (the "Series 2026A Loan Agreement") with the Baldwin IDA, and were used to finance a portion of the costs of the construction of the Bay Minette plant. In connection with this transaction, we incurred debt issuance costs of $4 million, which are amortized as an increase to interest expense and amortization of debt issuance costs over the term of the loan. The Series 2026A Bonds are guaranteed, jointly and severally, on a senior unsecured basis, by Novelis Inc. and certain of its subsidiaries.
The Series 2026A Bonds bear interest at 4.30% per annum, ending with a mandatory tender for purchase on March 1, 2033. After the end of the initial term interest rate period on such mandatory tender date, the Series 2026A Bonds may be converted to a variable (daily or weekly) interest rate period or may remain in a term interest rate period of the same or different duration. If the rate is converted to a variable rate, the interest rate will be reset at the end of each interest rate period. The Series 2026A Bonds will mature on March 1, 2056. The Company will make semiannual interest payments on the outstanding principal on March 1 and September 1 of each year, with the first such interest payment due on September 1, 2026. The Series 2026A Loan Agreement contains standard representations, covenants and events of default for transactions of this type.
As of June 30, 2026, we were in compliance with the covenants under the Series 2026A Loan Agreement.
2026 Term Loan Facility
On July 23, 2026, we entered into an unsecured $500 million loan facility (the "2026 Term Loan Facility") and borrowed the full amount available under the facility immediately after execution. The facility matures on July 24, 2028, bears interest at Term SOFR plus 1.00%, subject to an increase to 1.25% upon the occurrence of certain credit rating events, and contains customary covenants and events of default for transactions of this type.