The winter thaw has begun, and it doesn't have anything to do with whether or not a celebrated critter saw his shadow. It's the credit markets that are thawing-or softening, or becoming more malleable, choose your favorite description. What that means is that big companies interested in refinancing debt or pursuing acquisitions are finding much lower interest rates and better bond yields than they encountered even just weeks ago. They are borrowing again. That is the case with network equipment vendor Cisco Systems and cable TV firm Cablevision Systems, though they are doing it for different reasons.
Cablevision is managing its debt, while Cisco may be getting in position to make more acquisitions, among other plans. The WSJ report says that while debt issuances are up sequentially in the last month or so, only companies with strong debt ratings may be able to take advantage of the melting marketing conditions. Could we see other telecom firms, such as rural telcos that may have been ready to make acquisitions before the credit conditions spun out of control, come out of their holes to see if they find their shadows?
- The Wall Street Journal has this story
Debt markets were still dark last October
VoIP player Vonage had much trouble refinancing