Despite Junk Status, Nokia Hopes to Score $750M USD With Bonds
October 23, 2012 3:03 PM
comment(s) - last by
Bond offering will only be available to Europeans, will be converted to shares
Troubled Finnish phone Nokia Oyj. (
) is not letting its
stand in its way. The company announced on Tuesday that it would be looking to raise €750M ($972M USD) in unsecured convertible bonds, due in 2017.
The bond offering will be held on the Frankfurt Stock Exchange Open Market segment. The Frankfurt SE -- known in German as
or FWB for short -- is the world's tenth largest stock exchange.
Convertible bonds are a special type of bonds that convert into shares when they mature. The new bonds can be converted into 287.2 million total maximum shares, roughly 7.74 percent of total shares.
The cash pot at Nokia dipped from €4.2B ($5.44B USD) in June to €3.6B ($4.67B USD) in September. It also has a fair amount of debt -- €3.8B ($4.93B USD) in interest-bearing liabilities, €1.75B ($2.27B USD) of which matures in two years (2014). That maturing debt necessitated some sort of money-raising action, analysts commented.
Nokia share prices fell on dilution concerns, but analysts generally praised the decision as a wise financial gambit.
Evli Bank (Finland) analyst Mikko Ervasti to
, "It is a rather cheap way to get extra financing. They need buffers (and) their 2014 bond also requires financing."
In a move praised by analysts, Nokia is offering up convertible junk bonds.
[Image Source: CNN]
ING Groep N.V. (
) in a note added, "[The offering] also shows that the company is taking the question marks around its credit quality seriously and is willing to take the steps necessary to improve this."
The bonds will be available Oct. 26. A press release with full details is available
; however U.S. traders are forbidden by law to view that release and additionally are not allowed to purchase the bonds, according to a disclaimer on the press release.
Nokia is looking to scrounge up cash as it
to next month's
Windows Phone 8 launch
. The company has
put its headquarters
near Espoo, Finland up for sale.
Nokia [European readers only]
This article is over a month old, voting and posting comments is disabled
Which is it?
10/24/2012 9:34:17 AM
Headline says that it's 750M USD, the article says €750M ($972M USD). Which is it, Mick?
RE: Which is it?
10/24/2012 6:52:49 PM
What's 272M USD among friends? :P
"This is about the Internet. Everything on the Internet is encrypted. This is not a BlackBerry-only issue. If they can't deal with the Internet, they should shut it off." -- RIM co-CEO Michael Lazaridis
Quick Note: Nokia Lumia 920 $150 at Best Buy, HTC 8X Priced at $100
October 21, 2012, 12:37 PM
Nokia Looks to Sell Gleaming Finnish Headquarters
October 3, 2012, 12:44 PM
Nokia Officially Announces 4.3" Lumia 820; 4.5" Lumia 920 w/PureView, Wireless Charging
September 5, 2012, 10:21 AM
S&P Joins Fitch in Downgrade of Nokia's Bond Credit to "Junk"
April 27, 2012, 12:01 PM
Nokia Credit Rating Cut to "Junk" Status by Fitch
April 24, 2012, 11:44 AM
UK Drivers Must Now Give Their Cell Phones to Police After a Crash
July 29, 2014, 4:37 PM
Ford to Switch 3,300 Employees from BlackBerries to Apple iPhones by Year's End
July 29, 2014, 2:08 PM
Quick Note: Hilton Hotels to Use Smartphones as Room Keys, for Check-In/Check-Out
July 29, 2014, 12:53 PM
Verizon Wireless to Receive Exclusive "HTC One (M8) for Windows" Smartphone
July 29, 2014, 9:13 AM
Report: Microsoft's Chinese Offices Raided
July 28, 2014, 9:16 PM
Cell Phone Unlocking Bill Heads to President Obama's Desk
July 28, 2014, 11:58 AM
Most Popular Articles
Kindle Fire Phone Review Roundup -- A Solid "Meh"
July 23, 2014, 2:09 PM
Ford Details ’15 F-150’s 325hp, 2.7L EcoBoost V6; Demonstrates 732-lb Weight Loss
July 22, 2014, 6:55 PM
Windows 9 Will Merge Windows, Windows Phone, Windows RT in 2015
July 23, 2014, 3:33 PM
Comcast Memo: Harassing Customers During Retention Calls Actually IS Our Policy
July 22, 2014, 5:19 PM
Sony's Xperia Z3 Gets Detailed in Leaked Photos
July 25, 2014, 2:30 PM
Latest Blog Posts
Space Terrorism is a Looming Threat For the United States
Apr 23, 2014, 7:47 PM
Facebook Aims to Provide Internet to "Every Person in the World" with Drones, Satellites
Apr 1, 2014, 10:20 AM
Retail Mobile Sites Experience Outages in Light of Simplexity's Bankruptcy
Mar 14, 2014, 8:48 AM
Tesla vs. BMW: Who Has the Safer EV?
Feb 1, 2014, 2:56 PM
Justice Leaks Details of Next HTC One Two Flagship Phone
Dec 5, 2013, 4:04 PM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information