Summary
Oracle Corporation (ORCL) filed an 8-K on April 17, 2007, reporting the issuance of $1.7 billion in short-term promissory notes under its $3 billion Commercial Paper Program. These notes, with maturities ranging from two weeks to three months and a weighted average yield of 5.328%, are unsecured and rank equally with other senior unsecured debt. The company retains $1.3 billion in capacity under the program. The primary purpose for issuing these notes is to fund Oracle's pending acquisition of Hyperion Solutions Corporation. The tender offer for Hyperion shares was nearing its conclusion at the time of this filing, with an initial offering period ending April 13, 2007, and a subsequent period set to expire on April 18, 2007. This issuance highlights Oracle's strategy to leverage short-term debt for significant strategic acquisitions.
Key Highlights
- 1Oracle issued $1.7 billion in short-term promissory notes on April 11-12, 2007.
- 2The notes were issued under a $3 billion Commercial Paper Program, leaving $1.3 billion in available capacity.
- 3Maturities for the notes range from two weeks to three months, with 93% maturing within one to three months.
- 4The weighted average yield on the issued notes was 5.328%, including issuance costs.
- 5The funds raised are intended to finance the acquisition of Hyperion Solutions Corporation.
- 6The CP Notes are unsecured and rank pari passu with other unsecured and unsubordinated indebtedness of Oracle.
- 7The notes are not redeemable prior to maturity and cannot be prepaid voluntarily.