Summary
On October 11, 2013, Mondelez International, Inc. (MDLZ) entered into a new five-year, $4.5 billion senior unsecured revolving credit agreement, replacing a similar prior facility. This agreement provides the company with significant financial flexibility for general corporate purposes, including working capital needs and support for its commercial paper program. The new facility offers a potential for an additional $500 million increase, subject to lender agreement, and extends maturity to October 2018, with options for one-year extensions. Borrowings will bear variable interest rates based on LIBOR or a base rate plus an applicable margin, with the margin tied to the company's long-term senior unsecured debt rating. Importantly, the agreement includes a minimum shareholders' equity covenant, requiring MDLZ to maintain at least $24.6 billion in equity under specific accounting exclusions.
Key Highlights
- 1Mondelez entered into a new $4.5 billion senior unsecured revolving credit facility.
- 2The new facility has a five-year term, maturing on October 11, 2018, replacing a previous $4.5 billion facility.
- 3The company has the option to request an increase in the credit facility by up to $500 million.
- 4Borrowings will accrue interest at a variable rate tied to LIBOR or a base rate plus an applicable margin.
- 5The agreement includes a minimum shareholders' equity requirement of $24.6 billion.
- 6The credit facility is intended for general corporate purposes, including working capital and commercial paper support.
- 7Several major financial institutions are involved as joint lead arrangers, joint bookrunners, and co-administrative agents.