WarnerMedia Parent AT&T Takes Out $5.5B Loan, Assures Wall Street It’s Financially Solid Amid Coronavirus Pandemic
WarnerMedia mother or father A&T stated Tuesday it’s arrange a brand new $5.5 billion mortgage settlement at aggressive charges with 12 banks to offer extra monetary flexibility to its “already robust money place.” The loans are pre-payable with out penalty, it stated because it seeks to reassure the markets and workers that it’s on strong floor in unsure instances.
AT&T additionally famous that it has entry to a totally dedicated $15 billion revolver mortgage already in place that it has no want or plans to attract on in 2020 – nevertheless it’s there in case. AT&T is the newest huge media firm to flesh out its money cushion to hedge towards the financial dangers and unknowns of the coronavirus pandemic.
In an announcement, the corporate additionally supplied a monetary replace, ticking off its factors of monetary power, together with a robust steadiness sheet and engaging liquidity. It stated it had about $12 billion in money available as of Dec. 31 and acquired about $four billion from promoting most popular inventory in February. It additionally accomplished a share repurchase in March however has nowstopped all share repurchases.
COPYRIGHT_BP: Published on https://bingepost.com/warnermedia-parent-att-takes-out-5-5b-loan-assures-wall-street-its-financially-solid-amid-coronavirus-pandemic/88377/ by Hilda Workman on 2020-04-07T13:19:46.000Z
Going ahead, the corporate, which plans to roll out HBO Max subsequent moth, stated it expects the next to place it in a great place:• The power and relevance of core subscription companies, continued execution on enterprise transformation initiatives, and sizing operations to financial exercise will present money from operations that may help community investments, dividend funds and debt retirement, in addition to the flexibility to spend money on enterprise alternatives that come up because the economies get well.• About $2 billion from the anticipated closing later in 2020 from the beforehand introduced divestiture of CME, in addition to extra proceeds from numerous different actual property and tower gross sales.• The corporate expects to shut the sale of its Puerto Rico and U.S. Virgin Islands operations later this yr and intends to make use of the proceeds to retire an impressive most popular curiosity.• Continued entry to industrial paper, bond markets and different financing actions which, as up to now, might be utilized as a part of regular financing exercise based mostly on price, period and total market situations.• Because it has for the previous 36 years, the corporate can pay a quarterly dividend to shareholders. .
AT&T additionally added that its pension fund requires no money within the close to time period and it doesn’t count on any required contributions by way of 2022. The plan has allotted considerably the entire remaining belongings to mounted revenue, most popular securities and different investments which have returns a lot much less impacted by present fairness markets.
It additionally emphasised that it believes its publicity to close time period tools shortages is restricted given a geographically various provide chain.