Graphic Packaging Holding Company (GPK - Free Report) yesterday announced the offering of senior notes by its main operating subsidiary, Graphic Packaging International, LLC. The notes will be extended to qualified institutional buyers in a private offering.
It is worth mentioning here that Graphic Packaging’s share price decreased 0.15% yesterday, ending the trading session at $20.51.
Inside the Headlines
The offering comprised $400 million worth of senior notes due to mature in 2030 and €290 million worth of senior notes due to expire in 2029. The offered notes will be considered as unsecured obligations (senior) of Graphic Packaging International, LLC. The noted will be guaranteed by Graphic Packaging International Partners, LLC, and subsidiaries of Graphic Packaging International, LLC.
Graphic Packaging intends on using the net proceeds from the U.S. dollar notes offering to repay borrowings under Incremental Term A-4 Loan. The term loan was used by Graphic Packaging to finance its purchase of 100% shares of AR Packaging Group AB this November. The deal to the buyout was announced by Graphic Packaging in May 2021 and the transaction value was fixed at $1.45 billion in cash.
Notably, Sweden-based AR Packaging Group AB is a limited liability company. It specializes in consumer packaging (fiber-based) for customers in health, food, beauty, and consumer products.
Then again, Graphic Packaging expects to use the proceeds from the Euro notes offering to pay down borrowing sunder revolving facilities under the Fourth Amended and Restated Credit Agreement.
We believe that the offerings of senior notes will increase the company’s debts and, in turn, might inflate its financial obligations and hurt profitability. However, measures relating to redeeming notes and repaying debts will be a relief.
Graphic Packaging’s Debt Profile
The company's long-term debt at the end of the third quarter of 2021 stood at $4,132 million. Notably, its proceeds from debt issuance totaled $1,586 million in the first nine months of 2021, while long-term borrowing repayments amounted to $1,226 million.
Also, borrowings under revolving credit facilities were $2,876 million and $2,700 million was payment under this system.
Zacks Rank, Price Performance and Earnings Estimates
With a market capitalization of $6.3 billion, Graphic Packaging currently carries a Zacks Rank #3 (Hold). The company is poised to gain from solid demand, healthy backlog, and acquired assets. However, labor issues, supply-chain woes and inflation in costs are concerning.
In the past three months, the company’s shares have gained 6.2% compared with the industry’s increase of 2.3%.
In the past 30 days, the Zacks Consensus Estimate for its earnings decreased 28.9% to 32 cents per share for fourth-quarter 2021 and 8.7% to $1.15 for 2021. Meanwhile, the consensus estimate increased 6.1% to $1.92 for 2022.
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Graphic Packaging Holding Company (GPK - Free Report) yesterday announced the offering of senior notes by its main operating subsidiary, Graphic Packaging International, LLC. The notes will be extended to qualified institutional buyers in a private offering.
It is worth mentioning here that Graphic Packaging’s share price decreased 0.15% yesterday, ending the trading session at $20.51.
Inside the Headlines
The offering comprised $400 million worth of senior notes due to mature in 2030 and €290 million worth of senior notes due to expire in 2029. The offered notes will be considered as unsecured obligations (senior) of Graphic Packaging International, LLC. The noted will be guaranteed by Graphic Packaging International Partners, LLC, and subsidiaries of Graphic Packaging International, LLC.
Graphic Packaging intends on using the net proceeds from the U.S. dollar notes offering to repay borrowings under Incremental Term A-4 Loan. The term loan was used by Graphic Packaging to finance its purchase of 100% shares of AR Packaging Group AB this November. The deal to the buyout was announced by Graphic Packaging in May 2021 and the transaction value was fixed at $1.45 billion in cash.
Notably, Sweden-based AR Packaging Group AB is a limited liability company. It specializes in consumer packaging (fiber-based) for customers in health, food, beauty, and consumer products.
Then again, Graphic Packaging expects to use the proceeds from the Euro notes offering to pay down borrowing sunder revolving facilities under the Fourth Amended and Restated Credit Agreement.
We believe that the offerings of senior notes will increase the company’s debts and, in turn, might inflate its financial obligations and hurt profitability. However, measures relating to redeeming notes and repaying debts will be a relief.
Graphic Packaging’s Debt Profile
The company's long-term debt at the end of the third quarter of 2021 stood at $4,132 million. Notably, its proceeds from debt issuance totaled $1,586 million in the first nine months of 2021, while long-term borrowing repayments amounted to $1,226 million.
Also, borrowings under revolving credit facilities were $2,876 million and $2,700 million was payment under this system.
Zacks Rank, Price Performance and Earnings Estimates
With a market capitalization of $6.3 billion, Graphic Packaging currently carries a Zacks Rank #3 (Hold). The company is poised to gain from solid demand, healthy backlog, and acquired assets. However, labor issues, supply-chain woes and inflation in costs are concerning.
In the past three months, the company’s shares have gained 6.2% compared with the industry’s increase of 2.3%.
In the past 30 days, the Zacks Consensus Estimate for its earnings decreased 28.9% to 32 cents per share for fourth-quarter 2021 and 8.7% to $1.15 for 2021. Meanwhile, the consensus estimate increased 6.1% to $1.92 for 2022.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 5 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Download FREE: How To Profit From Trillions On Spending For Infrastructure >>
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