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Fidelity (FIS) Prices Senior Notes, Moody's Gives 'Baa3' Rating

Zacks Equity Research
Updated

Fidelity National Information Services, Inc. FIS recently announced the pricing of senior unsecured notes aggregating $2.5 billion. These bonds have been issued in three tranches of different amounts with varying coupon rates and maturity dates.

The $750 million, $1,250 million and $500 million senior notes, with annualized interest rate of 2.250%, 3.000% and 4.500%, are due to mature in 2021, 2026 and 2046, respectively.

The company intends to use the net proceeds for the repayment of its $2.2 billion debt on its revolving credit facility and the rest for general corporate purposes.

The company had on Aug 10 announced an amendment to its existing credit facility and term loan agreement saying that it has repaid $600 million of term loans maturing on Mar 30, 2017

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Moody’s Investor Services – the credit rating agency of Moody’s Corporation MCO– assigned a “Baa3” rating to the Notes that carry a stable outlook.

Fidelity’s growth in recent years has been primarily driven by acquisitions, which were many a times funded by raising long-term debt. This high level of indebtedness has been a major concern for Fidelity over the last few years. As of Jun 30, 2016, the company’s total debt outstanding was nearly $10.3 billion. The company’s net cash position was $9.4 billion.

A couple of other stocks in the same space include Equifax Inc. EFX and Fiserv, Inc. FISV.

FIDELITY NAT IN Price and Consensus

FIDELITY NAT IN Price and Consensus | FIDELITY NAT IN Quote

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MOODYS CORP (MCO): Free Stock Analysis Report
 
EQUIFAX INC (EFX): Free Stock Analysis Report
 
FIDELITY NAT IN (FIS): Free Stock Analysis Report
 
FISERV INC (FISV): Free Stock Analysis Report
 
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Zacks Investment Research