Summary
Lockheed Martin Corporation (LMT) announced on September 6, 2011, the successful completion of a public offering of senior unsecured notes totaling $2 billion. This debt issuance is structured into three tranches: $500 million in 2.125% notes due 2016, $900 million in 3.350% notes due 2021, and $600 million in 4.850% notes due 2041. These notes were issued under an indenture with U.S. Bank National Association as trustee, allowing for unlimited debt issuances. The primary purpose of this offering is to enhance the company's financial flexibility. A significant portion of the proceeds will be used to redeem all $500 million of its outstanding 4.121% Notes due 2013. The remaining net proceeds are earmarked for general corporate purposes. This strategic move suggests LMT is managing its debt profile, potentially refinancing at lower interest rates and extending its debt maturity structure.
Key Highlights
- 1Lockheed Martin raised $2 billion through the issuance of senior unsecured notes.
- 2The offering consists of three series: $500M (2.125% due 2016), $900M (3.350% due 2021), and $600M (4.850% due 2041).
- 3The company plans to use a portion of the proceeds to redeem its $500 million of 4.121% Notes due 2013.
- 4The remaining proceeds will be allocated to general corporate purposes.
- 5The notes were issued under an underwriting agreement with Citigroup Global Markets Inc. and J.P. Morgan Securities LLC.
- 6The issuance was made under an existing indenture allowing for future debt issuances.