Summary
CME Group Inc. (CME) filed an 8-K on September 10, 2012, to report the completion of a public offering of $750 million in aggregate principal amount of 3.00% Notes due 2022. This offering was conducted under an existing shelf registration statement and was supplemented by a prospectus supplement filed on September 5, 2012. The primary stated use of proceeds is to retire CME's outstanding 5.40% notes maturing in August 2013. This debt issuance reflects CME's proactive approach to managing its capital structure and debt obligations. By issuing new, lower-interest notes, CME aims to refinance its existing, higher-interest debt, thereby potentially reducing its future interest expense. While the company indicated flexibility to use proceeds for general corporate purposes, the immediate focus is on debt maturity management.
Key Highlights
- 1Completed a public offering of $750,000,000 aggregate principal amount of 3.00% Notes due 2022.
- 2The primary intended use of proceeds is to retire the Company's outstanding 5.40% notes due August 2013.
- 3The offering was made under an Automatic Shelf Registration Statement on Form S-3.
- 4Entered into an Underwriting Agreement with Barclays Capital Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, and UBS Securities LLC.
- 5The Notes were issued under an Indenture, as supplemented by a Fifth Supplemental Indenture dated September 10, 2012.
- 6The effective fixed interest rate on the Notes is estimated to be 3.375% at issuance due to a forward-starting interest rate swap.
- 7The Indenture includes covenants that limit the Company's ability to incur certain liens and engage in sale/leaseback transactions, and includes a change of control provision with a put option for noteholders.