Kraft Foods in debt sell-off
Kraft Foods, recently confirmed as the proud owner of Cadbury, will this week be selling off debt to investors in tranches of no less than $1 billion. In effect the company is looking to refinance the debt it took on in connection with the Cadbury deal with the bonds expected to have a life of 3.25 years, six years, 10 years and 30 years.
Investors in Kraft Foods recently saw the company's credit rating downgraded two notches by S&P, something which some of the larger investors in the company had expressed concern about. However, S&P has already put the company on a positive ratings watch with many investors expecting a sharp rebound which could see the company reclaim the two notches it has lost on the credit rating scale.
The company is confident of creating more than sufficient cash flow to cover its growing debt interest payments which should help with a rerating of the company's credit rating in the short term. It is interesting to see that Kraft Foods has been very swift with its response to the debt situation after only officially gaining control of Cadbury yesterday. However, this does reflect the need to respond to market conditions as quickly as possible in the current economic climate.
Share this..
Related stories
Taxpayer stakes in UK banks to be managed on arms length basis
It has been announced that Sir Philip Hampton and John Kingman, the two heavyweights put in charge of the government's £37 billion rescue package, will manage taxpayer investments on a commercial arm's length basis. This announcement seems to be at odds with the government's headline of various restrictions and duties in order for the banks in question to receive assistance. It seems as though th...
Read MoreGerman government pays the price for bungled GM Europe takeover
It has been revealed that Vauxhall workers at the Ellesmere Port plant in the UK could escape the cost-cutting exercise within GM Europe which will see significant jobs in the short to medium term. There are also hopes that the Luton plant will at least in the short term avoid any significant job losses with the vast majority of cost savings set to be implemented within the company's German operat...
Read MoreSainsbury Shares Surge As The QIA Returns
After the recent much publicised and ultimately unsuccessful takeover attempt by the Qatar Investment Authority (QIA) it seems that the wealthy investment fund is back in the market for another look at Sainsbury. It was today confirmed that the QIA has acquired a further 7 million shares in the operation at a cost of over £20 million. This takes the investment fund’s stake up to 25.3% but...
Read MoreMove to block HBOS takeover is rejected
The move to block the takeover of HBOS by Lloyd's Bank was yesterday defeated when the Competition Appeals Tribunal dismissed the case as having no foundation. This action had been taken by the merger Action Group which was a group of Scottish business people who were looking to block the takeover, which included the bank of Scotland subsidiary, and attempt their own take over of the business.
Government left with £2.3 billion loss after shareholders snub RBS rescue
The government has today been left nursing a £2.3 billion loss after Royal Bank of Scotland shareholders snubbed their attempt at raising £15 billion and leaving the government to take up the vast majority of shares on offer. The government's holding is now 57.9% and gives its effective control of one of the U.K.'s largest commercial banks.
This is not the start to the rescue pack...