Summary
Atmos Energy Corporation (ATO) has announced the full redemption of its outstanding Senior Notes due 2013, with a redemption date set for on or about August 28, 2012. This action, detailed in a Notice of Full Redemption filed on July 27, 2012, is a significant event for the company's debt management strategy. The redemption price will be determined based on the principal amount or the present value of remaining payments, plus accrued interest. Investors should note that Atmos Energy plans to fund this redemption primarily through commercial paper, which will then be refinanced with a short-term financing facility. The ultimate intention is to repay this short-term debt with proceeds from the issuance of new long-term unsecured notes in January 2013. This indicates a strategic move to replace maturing debt with new long-term financing, potentially at different interest rates and terms.
Key Highlights
- 1Atmos Energy Corporation is redeeming all of its outstanding Senior Notes due 2013.
- 2The redemption date is scheduled for on or about August 28, 2012.
- 3The redemption price will be the greater of 100% of principal or the present value of remaining payments, plus accrued interest.
- 4The company intends to initially fund the redemption using commercial paper under its revolving credit facility.
- 5A short-term financing facility will be used to repay the commercial paper borrowings.
- 6New unsecured long-term notes are expected to be issued in January 2013 to repay the short-term facility.