What is the primary purpose of the new debt issuance?

The primary purpose of the $750 million note issuance is to repay outstanding commercial paper borrowings that were backed by the company's 364-day revolving bridge facility. Any remaining proceeds will be used for general corporate purposes.

What are the key terms of the new notes?

The notes have a principal amount of $750 million, a coupon rate of 5.75%, and are due in 2014. They were sold to underwriters at 99.384% of their principal amount and offered to the public at 99.839%.

What is the significance of terminating the 364-day revolving bridge facility?

The termination of the bridge facility, effective shortly after the note issuance, suggests that CME Group is securing its financing through longer-term debt instruments rather than short-term credit lines. This could indicate a proactive approach to managing its liquidity and debt profile in the current market conditions.

What are the covenants associated with the new notes?

The indenture governing the notes includes covenants that restrict CME Group's ability to incur certain liens, engage in sale and leaseback transactions, and undergo significant asset disposals through consolidation or merger. It also includes a provision for a change of control offer to repurchase the notes at 101% of principal if certain conditions related to a change of control and credit rating downgrade are met.

CME 8-K: Material Agreements

Summary

CME Group Inc. (CME) has filed an 8-K report detailing the completion of a public offering of $750 million in aggregate principal amount of 5.75% Notes due 2014. This offering, finalized on February 9, 2009, was conducted under an existing shelf registration statement. The net proceeds are earmarked for repaying outstanding commercial paper backed by the company's 364-day revolving bridge facility, with any remaining funds allocated to general corporate purposes. Additionally, the report indicates CME Group's intention to terminate its 364-day revolving bridge facility, effective February 10, 2009. This strategic move suggests a shift in the company's financing strategy, potentially driven by the successful debt issuance and its implications for liquidity management in the prevailing economic climate.

Key Highlights

1Completion of a $750 million public offering of 5.75% Notes due 2014.
2Net proceeds intended to repay outstanding commercial paper borrowings.
3Remaining proceeds to be used for general corporate purposes.
4Entry into an Underwriting Agreement with Banc of America Securities LLC, UBS Securities LLC, Barclays Capital Inc., and Lloyds TSB Bank plc.
5Issuance of Notes under an Indenture, as supplemented by a Fourth Supplemental Indenture.
6Company to terminate its 364-day revolving bridge facility effective February 10, 2009.

CME GROUP INC. 8-K Report, Material Agreement (Feb 9, 2009)

Summary

Key Highlights

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