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Coca-Cola Issues Notes - Analyst Blog

The Coca-Cola Company ( KO ) has recently issued senior unsecured notes totaling $2.75 billion, with a 2-year, 3-year, and a 6-year tranche.

Coca-Cola issued $1 billion floating rate notes due in 2014, and another $1 billion notes bearing a coupon of 0.75% due in 2015. The third notes issue for a principal aggregate amount of $0.75 billion carried a coupon of 1.65% due in 2018. Coca-Cola intends to utilize its proceeds to repay the outstanding commercial paper.

In addition, Deutsche Bank AG ( DB )'s Deutsche Bank Securities Inc., HSBC Holdings Plc ( HBC )'s HSBC Securities ( USA ) Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated and UBS AG ( UBS )'s UBS Securities LLC were the joint book-running managers for the offering.

The rating agency Fitch Ratings provided an 'A+' rating to the company's $2.75 billion note issuance with a stable outlook, while the rating agency Standard & Poor's Ratings Services gave an 'A+' rating to the notes.

The A+ ratings highlight the company's ability to generate considerable cash and pay back its debts consistently. Coca Cola's cash from operations was $9.5 billion in 2011. The company's strong cash flows allowed it to repurchase $2.9 billion of shares in 2011, and Coca-Cola also expects net share repurchases of an additional $2.5 to $3.0 billion in 2012. In addition, Coca-Cola also hiked its annual dividend by 8.5% to 51 cents per share from 47 cents per share for the year 2012.

Coca-Cola currently holds a Zacks #3 Rank, which translates into a short-term Hold rating. On a long-term basis, we maintain a Neutral rating on the stock.

DEUTSCHE BK AG ( DB ): Free Stock Analysis Report

HSBC HOLDINGS ( HBC ): Free Stock Analysis Report

COCA COLA CO ( KO ): Free Stock Analysis Report

UBS AG ( UBS ): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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