Summary
Lockheed Martin Corporation (LMT) announced on September 7, 2017, the issuance of approximately $1.58 billion in new 4.09% Notes due 2052. These new notes were primarily issued in exchange for a portion of the company's existing outstanding debt securities, referred to as "old notes." This debt exchange is part of a broader strategy to refinance and potentially lower the company's overall cost of borrowing over the long term. The exchange offer, which expired on September 1, 2017, was only available to "qualified institutional buyers" and certain non-U.S. persons, indicating a targeted approach to debt management. The company also paid a small aggregate cash consideration and accrued interest on the exchanged debt. The new notes are general unsecured obligations of Lockheed Martin, ranking equally with other unsecured and unsubordinated debt, but junior to any secured debt and effectively junior to subsidiary debt.
Key Highlights
- 1Issuance of $1,578,468,000 in new 4.09% Notes due 2052.
- 2The new notes were issued primarily in exchange for existing "old notes" through an exchange offer.
- 3The exchange offer was limited to "qualified institutional buyers" and certain non-U.S. persons.
- 4Lockheed Martin paid approximately $15.9 million in cash consideration and accrued interest for the exchanged debt.
- 5The new notes mature on September 15, 2052.
- 6The company has the option to redeem the notes prior to maturity under specific conditions (par call and after par call date).
- 7The new notes are general unsecured obligations, ranking equally with other unsecured debt but junior to secured debt and subsidiary debt.