) announced that two subsidiaries of its outdoor advertising
business - CBS Outdoor, intend to issue senior unsecured notes
worth $800 million. The notes issue relates to the company's
prior disclosure of spinning off its CBS Outdoor business and the
conversion of the same into a Real Estate Investment Trust
Simultaneous to the notes issue, the subsidiaries are likely
to enter into a term loan worth $800 million. Under the terms of
the issue, CBS Outdoor is slated to pay a portion of the proceeds
of the issue and the term loan to its parent company. The
remaining proceeds will be absorbed by CBS Outdoor for its
regular cash requirements and other corporate needs.
The offering will be placed privately to both qualified
institutional investors in the U.S. and investors residing
outside the U.S. The notes to be offered are not registered under
the Securities Act and hence are prohibited from being sold or
offered in the U.S. without being registered or enjoying any
Borrowing costs are still considerably low in the U.S.,
enabling companies to obtain easy financing. Corporate bonds and
borrowings from banks are in high demand as the U.S. treasuries
are yielding low rates. We believe that this strategic move by
the company will provide it the financial flexibility to drive
CBS Corporation is a N.Y based company, operating through
Entertainment, Publishing, Cable Networks; Local Broadcasting and
Outdoor Americas. The company concluded the divestment of the
European and Asian segments of its Outdoor advertising business
in Sep 2013, for $225 million. The transaction resulted in a gain
of $147 million, partly offset by an after-tax charge of $110
The company reported third-quarter 2013 results in Nov 2013,
whereby its reported long-term debt stood at $5,944 million and a
free cash flow of $402 million was generated during the
This mass media company holds a Zacks Rank #3 (Hold). Other
better-ranked stocks in the services industry include
Cross Country Healthcare, Inc.
SouFun Holdings Ltd.
). While Cross Country and SouFun Holdings carry a Zacks Rank #1
(Strong Buy), Pearson has a Zacks Rank # 2 (Buy).
CBS CORP (CBS): Free Stock Analysis Report
CROSS COUNTRY (CCRN): Free Stock Analysis
PEARSON PLC-ADR (PSO): Free Stock Analysis
SOUFUN HLDG-ADR (SFUN): Free Stock Analysis
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