Summary
Boston Scientific Corporation (BSX) filed an 8-K report on August 13, 2013, detailing the completion of a significant debt offering and the subsequent redemption of older debt. The company successfully raised approximately $1.04 billion in net proceeds from the issuance of $1.05 billion in aggregate principal amount of senior notes. These notes consist of $600 million of 2.650% Senior Notes due 2018 and $450 million of 4.125% Senior Notes due 2023. The primary purpose of this debt issuance was to refinance existing debt. Specifically, the company announced its intention to use the net proceeds, along with borrowings from its term loan facility, to redeem all or a portion of its 5.450% notes due June 15, 2014 ($600 million outstanding) and its 4.500% notes due January 15, 2015 ($850 million outstanding). Following the offering, Boston Scientific initiated the redemption process for these maturing notes, scheduled for September 12, 2013.
Key Highlights
- 1Boston Scientific completed an offering of $1.05 billion in aggregate principal amount of senior notes, comprised of $600 million of 2.650% Senior Notes due 2018 and $450 million of 4.125% Senior Notes due 2023.
- 2The net proceeds from the offering amounted to approximately $1.04 billion after deducting underwriting discounts and estimated expenses.
- 3The company intends to use the proceeds to redeem its outstanding 5.450% notes due June 15, 2014, and 4.500% notes due January 15, 2015.
- 4Redemption notices have been issued to fully redeem the June 2014 Notes and January 2015 Notes on September 12, 2013.
- 5The new senior notes are unsecured and rank equally with existing senior unsecured and unsubordinated indebtedness.
- 6The notes contain covenants that restrict the company's ability to merge, consolidate, transfer assets, or incur liens, subject to certain exceptions.
- 7A 'Change of Control Repurchase Event' would obligate the company to offer to repurchase all outstanding notes at 101% of their principal amount.