KO
Coca Cola CO
NYSE
8-K: Coca-Cola Completes Euro-Denominated Notes Offering, Raising 1 Billion Euros
Sentiment:
Debt Offering Announcement
15 August 2024 4:10 PM
Coca-Cola successfully completed a public offering of 1 billion euros in aggregate principal amount of euro-denominated notes due in 2037 and 2053.
Capital raise
The Coca-Cola Company completed a public offering of 1 billion euros in aggregate principal amount of euro-denominated notes.
The offering includes 500 million euros of 3.375% notes due in 2037 and 500 million euros of 3.750% notes due in 2053.
Summary
- The Coca-Cola Company has finalized a public offering of euro-denominated notes, totaling 1 billion euros.
- This offering includes 500 million euros of 3.375% notes due in 2037 and 500 million euros of 3.750% notes due in 2053.
- The notes were issued under the company's existing shelf registration statement filed in October 2022.
- The proceeds from the offering will be used for general corporate purposes, including working capital, capital expenditures, acquisitions, and debt repayment.
- A portion of the funds may also be used for ongoing tax litigation with the IRS and a final contingent payment related to the acquisition of fairlife, LLC in 2025.
Sentiment
Score: 7
Explanation: The document indicates a successful capital raise, which is generally positive. However, the use of some funds for litigation and contingent payments introduces some uncertainty.
Positives
- The successful completion of the 1 billion euro notes offering provides Coca-Cola with significant capital.
- The funds can be used for various strategic purposes, including acquisitions and debt management.
- The offering demonstrates investor confidence in Coca-Cola's financial stability and future prospects.
- The company has secured long-term financing with notes maturing in 2037 and 2053.
Negatives
- The company will incur interest expenses on the newly issued debt.
- A portion of the proceeds may be used to settle ongoing tax litigation, which indicates potential financial liabilities.
- The company is obligated to make a final contingent payment in 2025 related to the fairlife acquisition.
Risks
- The company faces ongoing tax litigation with the IRS, which could result in significant financial liabilities.
- The final contingent payment for the fairlife acquisition in 2025 represents a future financial obligation.
- Changes in interest rates could impact the cost of servicing the newly issued debt.
- The company's ability to use the proceeds effectively for acquisitions and investments will impact future performance.
Future Outlook
The company intends to use the net proceeds from the offering for general corporate purposes, including working capital, capital expenditures, acquisitions, and debt repayment, as well as for potential payments related to tax litigation and the fairlife acquisition.
Industry Context
This offering is consistent with large multinational corporations utilizing debt markets to raise capital for various strategic initiatives. The issuance of euro-denominated notes allows Coca-Cola to diversify its funding sources and potentially benefit from favorable interest rates in the European market.
Comparison to Industry Standards
- Other large consumer goods companies like PepsiCo and Nestle also frequently issue debt to fund operations and acquisitions.
- The interest rates on Coca-Cola's notes are comparable to those of other investment-grade corporate bonds issued in the current market environment.
- The use of proceeds for general corporate purposes and potential acquisitions is a common practice among large corporations.
- The maturity dates of the notes are within the typical range for corporate debt issuances.
Stakeholder Impact
- Shareholders may view the capital raise positively as it provides financial flexibility.
- Creditors will be impacted by the new debt obligations.
- Employees may benefit from the company's ability to invest in growth initiatives.
- Customers and suppliers may not be directly impacted by this transaction.
Next Steps
- Coca-Cola will allocate the net proceeds from the offering to various corporate purposes.
- The company will continue to manage its debt obligations and monitor market conditions.
- The company will make a final contingent payment related to the fairlife acquisition in 2025.
Legal Proceedings
- The company intends to use a portion of the proceeds for ongoing tax litigation with the United States Internal Revenue Service.
Key Dates
- 1988-04-26: Date of the Amended and Restated Indenture between Coca-Cola and Deutsche Bank Trust Company Americas.
- 1992-02-24: Date of the First Supplemental Indenture.
- 2007-11-01: Date of the Second Supplemental Indenture.
- 2022-10-28: Date the shelf registration statement on Form S-3 was filed with the SEC.
- 2024-08-08: Date of the Underwriting Agreement and preliminary prospectus supplement.
- 2024-08-15: Date of the completion of the Euro Notes offering and the 8-K filing.
- 2025: Year of the final contingent consideration payment for the fairlife acquisition.
- 2037-08-15: Maturity date of the 3.375% Notes.
- 2053-08-15: Maturity date of the 3.750% Notes.
Keywords
Euro Notes, Debt Offering, Coca-Cola, Corporate Finance, Fixed Income, Bonds, Capital Markets, Debt Securities, Indenture
KO
Coca Cola CO
NYSE
Sector: TBD
Filings with Classifications
Worse than expected
26 June 2025 11:33 AM
Current Report
- Operating income decreased by 12% in 2024, indicating a decline in core profitability.
- Net cash provided by operating activities significantly decreased by 41% due to the large IRS tax litigation payment, impacting liquidity.
- The company recorded substantial 'Other Operating Charges' including a $760 million impairment for the BodyArmor trademark and a $3,109 million remeasurement of the fairlife contingent consideration liability, indicating significant one-time or non-recurring negative impacts on profitability.
Delay expected
26 June 2025 11:33 AM
Current Report
- Certain initiatives included in the company's productivity and reinvestment program, primarily designed to further simplify and standardize the organization, have been delayed and will now be completed during 2025.
Worse than expected
1 May 2025 3:38 PM
Quarterly Report
- Net operating revenues decreased by 2% due to foreign currency fluctuations and strategic divestitures.
Delay expected
1 May 2025 3:38 PM
Quarterly Report
- Certain initiatives included in the productivity and reinvestment program, which are primarily designed to further simplify and standardize our organization, have been delayed and will be completed during 2025.
Worse than expected
29 April 2025 6:58 AM
Quarterly Report
- Net revenues declined 2% due to currency headwinds and refranchising, indicating worse performance than expected.
- Free cash flow was negative $5.5 billion due to a large contingent consideration payment, indicating worse performance than expected.
Worse than expected
20 February 2025 3:17 PM
Annual Results
- Operating income decreased by 12% due to higher commodity costs, selling, general and administrative expenses, other operating charges, the impact of refranchising, and unfavorable foreign currency exchange rate impact.
Worse than expected
24 October 2024 11:55 AM
Quarterly Report
- The company's operating income decreased by 23% in Q3 2024 compared to Q3 2023.
- The company's net operating revenues decreased by 1% in Q3 2024 compared to Q3 2023.
- The company recorded a $760 million impairment charge related to the BodyArmor trademark.
Worse than expected
23 October 2024 7:00 AM
Quarterly Report
- The company's net revenue declined by 1%, and operating income decreased by 23%, indicating worse than expected results.
- EPS declined by 7%, which is worse than expected.
- The company's cash flow from operations and free cash flow decreased due to a $6.0 billion payment to the IRS, which is worse than expected.
Capital raise
15 August 2024 4:10 PM
Debt Offering Announcement
- The Coca-Cola Company completed a public offering of 1 billion euros in aggregate principal amount of euro-denominated notes.
- The offering includes 500 million euros of 3.375% notes due in 2037 and 500 million euros of 3.750% notes due in 2053.
Capital raise
14 August 2024 4:14 PM
Debt Offering Announcement
- The Coca-Cola Company completed a public offering of $3 billion in senior notes.
- The offering included $750 million of 4.650% notes due in 2034, $1.5 billion of 5.200% notes due in 2055, and $750 million of 5.400% notes due in 2064.
- The company intends to use the net proceeds for general corporate purposes.
Capital raise
9 August 2024 4:24 PM
Debt Offering Announcement
- Coca-Cola is raising $3 billion through a debt offering.
- The offering is split into a US dollar-denominated offering and a euro-denominated offering.
- The US dollar offering includes $750 million of 4.650% notes due 2034, $1.5 billion of 5.200% notes due 2055, and $750 million of 5.400% notes due 2064.
- The euro offering includes 500 million of 3.375% notes due 2037 and 500 million of 3.750% notes due 2053.
Worse than expected
29 July 2024 3:54 PM
Quarterly Report
- Operating income decreased by 17% for the first six months of 2024, indicating a worse performance compared to the same period last year.
- The company recorded significant other operating charges of $2.943 billion for the first six months of 2024, negatively impacting profitability.
- The potential tax liability of $16 billion due to the ongoing dispute with the IRS is a significant financial risk.
Better than expected
23 July 2024 6:58 AM
Quarterly Report
- The company's organic revenue growth of 15% exceeded expectations.
- The company raised its full-year guidance for organic revenue growth to 9-10% and comparable EPS growth to 5-6%.
Capital raise
14 May 2024 4:08 PM
Debt Offering Announcement
- The Coca-Cola Company completed a public offering of €1 billion in Euro-denominated notes.
- The offering was split into two tranches: €500 million of 3.125% notes due in 2032 and €500 million of 3.500% notes due in 2044.
Capital raise
13 May 2024 4:13 PM
Debt Offering Announcement
- Coca-Cola completed a public offering of $3 billion in aggregate principal amount of U.S. dollar-denominated notes.
- The offering included three tranches with different maturities and interest rates.
- The proceeds will be used for general corporate purposes and potentially for tax litigation payments.
Capital raise
8 May 2024 5:07 PM
Debt Offering Announcement
- The company is raising $3 billion through the issuance of US dollar-denominated notes.
- The company is raising 1 billion through the issuance of Euro-denominated notes.
Worse than expected
2 May 2024 1:52 PM
Quarterly Report
- The company's operating income decreased by 36% due to a $760 million impairment charge related to the BodyArmor trademark and a $765 million charge related to the remeasurement of a contingent consideration liability for fairlife.
Worse than expected
30 April 2024 6:58 AM
Quarterly Report
- The company's reported operating income declined by 36%, significantly worse than expected due to substantial charges related to the fairlife acquisition and the BODYARMOR trademark impairment.
Better than expected
13 February 2024 6:57 AM
Quarterly and Annual Earnings Release
- Organic revenue growth exceeded expectations, demonstrating strong underlying business performance.
- Global unit case volume growth indicates continued demand for Coca-Cola products despite market challenges.
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