Summary
Motorola Solutions, Inc. (MSI) filed an 8-K on August 7, 2019, to announce a significant debt refinancing transaction. The company has entered into an underwriting agreement to issue an additional $150 million in aggregate principal amount of its 4.600% senior notes due 2029. These new notes will be fungible with and will increase the total outstanding principal amount of this note series to $800 million. The primary purpose of this offering is to fund the redemption of MSI's 3.500% senior notes due 2021. The company has instructed the trustee to redeem all outstanding $150.3 million of these 2021 notes on August 22, 2019. This move demonstrates proactive debt management, likely aimed at optimizing interest expense by replacing higher-cost debt with new debt at a similar coupon rate but with a longer maturity, or potentially taking advantage of favorable market conditions.
Key Highlights
- 1Motorola Solutions issued an additional $150 million of 4.600% senior notes due 2029.
- 2The new notes are fungible with the existing 2029 notes, increasing the total outstanding principal amount for this series to $800 million.
- 3Proceeds will be used to redeem $150.3 million of 3.500% senior notes due 2021.
- 4The redemption of the 2021 notes is scheduled for August 22, 2019.
- 5This transaction indicates proactive debt management and a focus on extending debt maturities.
- 6The offering was underwritten by BofA Securities, Inc.
- 7The new notes are registered under an existing Form S-3 shelf registration statement.