Summary
On March 13, 2009, The Boeing Company (BA) announced the successful issuance of $700 million in 5.000% Senior Notes due 2014, $650 million in 6.000% Senior Notes due 2019, and $500 million in 6.875% Senior Notes due 2039, totaling $1.85 billion in aggregate principal amount. These notes are unsecured and rank equally with other senior unsecured debt of the company. This debt issuance provides Boeing with significant capital, likely to bolster its liquidity and fund its ongoing operations and strategic initiatives, particularly important in the economic climate of early 2009. The filing details the terms of the notes, including maturity dates, interest payment schedules, and the company's right to redeem the notes. Investors should note the coupon rates and maturity profiles of these new debt instruments as they represent a material addition to Boeing's capital structure.
Key Highlights
- 1Boeing raised a total of $1.85 billion through the issuance of three tranches of senior notes.
- 2The notes issued include $700 million due 2014 (5.000% coupon), $650 million due 2019 (6.000% coupon), and $500 million due 2039 (6.875% coupon).
- 3The debt is unsecured and subordinated to any secured debt, ranking pari passu with existing unsecured and unsubordinated debt.
- 4Interest payments on the notes will be made semi-annually on March 15 and September 15, with the first payment on September 15, 2009.
- 5The company retains the right to redeem the notes in whole or in part prior to maturity.
- 6The issuance was conducted through a Purchase Agreement with J.P. Morgan Securities Inc. and UBS Securities LLC as representatives for the purchasers.
- 7Relevant filings including a Prospectus Supplement have been made with the SEC to provide detailed information on the offering.