IBM Announces Debt Exchange Offers - [H]ard|Forum

**Steve** · #1 11-08-2009, 10:09 AM

IBM today announced that it has commenced offers to exchange (the “exchange offers”) any and all of its 7.125 percent debentures due 2096, 7.000 percent debentures due 2045 and 8.000 percent notes due 2038 for a new series of 5.600 percent senior notes due 2039 (the “new notes”) and cash. To encourage holders to tender early, IBM is offering an early exchange premium to holders who validly tender their old notes before 5:00 p.m. EST, on Friday, November 20, 2009 (the “early exchange date”). The exchange offers expire at 12:00 a.m. EST, on Monday, December 7, 2009 (the “expiration date”). We are conducting the exchange offers to retire high coupon long-dated debt in a favorable interest rate environment. The terms and conditions of the exchange offers are described in IBM’s exchange circular dated November 6, 2009 (the “exchange circular”).

**NKDietrich** · #2 11-08-2009, 10:38 AM

I have no idea what any of that even means.

**TheCadaver** · #3 11-08-2009, 11:03 AM

English please? XD

**DanNeely** · #4 11-08-2009, 11:15 AM

IBM is offering cash to its creditors to let it refinance high interest loans at a lower rate.

**Whisperfang** · #5 11-08-2009, 11:26 AM

Quote:

Originally Posted by NKDietrich

I have no idea what any of that even means.

QFT

**Valset** · #6 11-08-2009, 02:00 PM

Quote:

Originally Posted by Whisperfang

QFT

they are refinancing there debt and offing to pay some the difference to compensate the loss of value compared with money up front. or to look at it differently they are offering to free up the investor capital in exchange for reducing their liability. If I had to guess they are trying to make their books look better and save some money (though I doubt much).

**Peteman100** · #7 11-08-2009, 02:24 PM

Why would they want to advertise this on Hardforums?

**westrock2000** · #8 11-08-2009, 02:53 PM

Quote:

7.125 percent debentures due 2096

Is that 7% APR on a near hundred year loan?

**DanNeely** · #9 11-08-2009, 03:50 PM

You're asking the wrong question. It's "Why did Steve think we would care?"

**Peteman100** · #10 11-08-2009, 04:01 PM

Quote:

Originally Posted by DanNeely

You're asking the wrong question. It's "Why did Steve think we would care?"

I was under the impression that the posts in italics were advertisements, of sorts

**DanNeely** · #11 11-08-2009, 05:24 PM

I'd never heard that before. It it hiding in a faq somewhere?

**Peteman100** · #12 11-08-2009, 09:26 PM

Quote:

Originally Posted by DanNeely

I'd never heard that before. It it hiding in a faq somewhere?

I was assuming. I haven't seen it documented anywhere. But why else would they use different formatting (italics)?

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