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Thomson Reuters refinances bonds at lower rate

Thomson Reuters raised C$750 million from an issue of 10-year bonds, almost double the C$400 million minimum targeted.

The Wall Street Journal reported that the issue was priced at 143.6 basis points over the government of Canada 3.5 per cent June 2020 benchmark bond for a yield of 4.398 per cent. The bonds carry a coupon of 4.35 per cent.

Thomson Reuters said the offering is expected to close on 30 September. It plans to use the net proceeds from the offering, available cash and/or other resources to repay other corporate debt - EUR 500 million principal amount of 4.625 per cent medium term notes upon their maturity in November 2010.

The Globe and Mail of Toronto said the old debt was the last of Reuters PLC paper that was absorbed when Thomson and Reuters merged in 2008, according to Moody’s, which assigned the debt a Baa1 rating. After the refinancing, all of the company’s debt will bear the Thomson Reuters name.

Fitch Ratings assigned the new note an A- rating, reflecting the company’s cash flow generating ability, sound balance sheet and consistent and conservative financial policies. It said it believes Thomson Reuters “has the flexibility to address upcoming maturities, make smaller prudent acquisitions and participate in some share repurchase activity”.

In August Standard & Poor's lifted its outlook on Thomson Reuters to stable in response to the company's improved operating performance. ■

The Wall Street Journal