Alcatel-Lucent to raise bonds to pay down $1.75B of debt
Alcatel-Lucent (NYSE: ALU) has launched a $1.4 billion offer in convertible bonds, which will be used to pay off the $1.75 billion on the company's senior secured credit facility in the U.S. as part of its Shift Plan.
The offering includes $816 million of bonds due Jan. 30, 2019, and $544 million maturing on Jan. 30, 2020.
However, the book runners have an option to increase the issues by up to 10 percent.
Alcatel-Lucent said the bonds will be issued at a premium to Alcatel-Lucent's share price, at 35-40 percent for the 2019 bonds and 32-37 percent for the 2020 bonds. Set to be listed in Paris, they will pay little to no interest and be convertible one-to-one in Alcatel-Lucent shares.
Issuing these bonds is just one of many moves Alcatel-Lucent's CEO Michel Combes is making to get the company back on a solid financial footing. In addition to looking for a buyer for its enterprise division, the vendor shed its public sector division LGS Innovations in December for $200 million.
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