News
Thomson Reuters issues $1 billion in 3 and 10-year notes
Tuesday 23 September 2014
Thomson Reuters is issuing $1 billion of debt securities comprising $550 million of 1.65 per cent notes due in 2017, and $450 million of 3.85 per cent notes due in 2024.
The company said it plans to use the proceeds for general corporate purposes. These include to repay outstanding debt and finance share repurchases under a previously announced $1 billion share buyback programme.
Standard and Poors and Fitch Ratings both assigned an investment grade BBB+ rating to the issue, the same as their ratings on similar past issues of debt. As of 30 June 2014, Thomson Reuters had approximately $8.1 billion of debt outstanding, Fitch said.
It said - as it has done in the past - Thomson Reuters had “meaningful barriers to entry” in its core businesses and referred to “a limited number of well-capitalized competitors”. But it said the company’s guidance on revenue and earnings was achievable.
The latest issue did not make much difference to the company’s overall debt picture in the coming years, the ratings agency said.
Its definition says: “’BBB’ ratings indicate that expectations of default risk are currently low. The capacity for payment of financial commitments is considered adequate but adverse business or economic conditions are more likely to impair this capacity.”
Fitch said: “The ratings reflect TRI's cash flow generating ability, geographic and product diversification, sound balance sheet and consistent and conservative financial policies.”
It added that the company's capital allocation strategy will remain focused on investments in its core businesses, acquisitions and return of capital to shareholders (via dividends and/or share buybacks) while remaining disciplined in its approach to divestments and acquisitions. ■
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- Market Watch
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