Why is Mondelēz redeeming these notes?

While the exact reason is not explicitly stated, redeeming the notes before maturity often indicates that the company believes it can refinance the debt at a lower interest rate, reduce its overall interest expense, or optimize its capital structure.

What is the total amount of debt being redeemed?

The company is redeeming the entire outstanding principal amount of $850 million for the 2.250% Notes due 2019.

How will the redemption price be determined?

The redemption price will be the higher of: (1) 100% of the principal amount of the notes, or (2) the sum of the present values of all remaining scheduled principal and interest payments (excluding interest accrued up to the redemption date), discounted semi-annually at the Treasury Rate plus 10 basis points. Accrued and unpaid interest up to, but not including, the redemption date will also be paid.

When will bondholders receive their redemption payment?

Bondholders will receive their redemption payment on the redemption date, which is December 16, 2016.

MDLZ 8-K SEC Disclosure

Summary

Mondelēz International, Inc. (MDLZ) announced via an 8-K filing on November 16, 2016, its intention to redeem its entire outstanding $850 million aggregate principal amount of 2.250% Notes due 2019. This redemption is scheduled for December 16, 2016. Investors should note that the redemption price will be the greater of par value or a calculated amount based on present values discounted at the Treasury Rate plus 10 basis points, plus accrued interest. This action suggests the company may be seeking to optimize its debt structure, potentially refinancing at a lower interest rate or managing its leverage. The press release announcing this redemption is filed as an exhibit to this report.

Key Highlights

1Mondelēz International to redeem $850 million of 2.250% Notes due 2019.
2Redemption date set for December 16, 2016.
3Redemption price calculated as the greater of 100% of principal or present value of remaining payments plus 10 basis points over Treasury Rate, plus accrued interest.
4This action indicates potential debt refinancing or optimization efforts by the company.
5The related press release is filed as an exhibit (Exhibit 99.1).

Mondelez International, Inc. 8-K Report, Corporate Update (Nov 16, 2016)

Summary

Key Highlights

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