Summary
Crown Castle International Corp. (CCI) has filed an 8-K report on December 19, 2007, detailing a significant financial risk management action. The company entered into interest rate swap agreements on December 17, 2007, with a combined notional amount of $625 million. These agreements are designed to hedge the company's exposure to fluctuating interest rates on its existing term loan. The swap agreements will be in effect from December 31, 2007, through December 31, 2009. Under these arrangements, Crown Castle will pay a fixed interest rate of approximately 4.134% while receiving variable interest payments based on three-month LIBOR. This move aims to provide greater predictability in the company's future interest expenses and cash flows related to its debt.
Key Highlights
- 1Crown Castle International Corp. entered into interest rate swap agreements totaling $625 million.
- 2The purpose of these agreements is to hedge against interest rate volatility on its term loan.
- 3The swaps cover the period from December 31, 2007, to December 31, 2009.
- 4Under the swaps, CCI will pay a fixed rate of approximately 4.134%.
- 5In return, CCI will receive variable interest payments based on three-month LIBOR.
- 6This action aims to stabilize future interest payment cash flows.
- 7The agreements relate to the term loan under the Credit Agreement dated January 9, 2007.