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
"A politician stumbles over himself... Then they pick it out. They edit it. He runs the clip, and then he makes a funny face, and the whole audience has a Pavlovian response." -- Joe Scarborough on John Stewart over Jim Cramer
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
Retiree Sues Apple For $7,500 for Wiping Honeymoon Photos From His iPhone
November 30, 2015, 10:23 AM
iPhone 7 May Pack 3-4 GB Memory, More Storage; 4-Inch Comeback is Rumored
November 20, 2015, 10:12 PM
OnePlus One, OnePlus 2 Will Receive Android Marshmallow in Q1 2016
November 16, 2015, 9:58 AM
Lenovo Whoa: Motorola Droid MAXX 2 and Turbo 2 Break Cover in Leaks
October 26, 2015, 3:12 PM
Leak: Apple Preps for First Real Android App Foray With New Apple Music App
October 24, 2015, 1:59 PM
Pepsi Smartphone? Empty Calories Coming Soon to the Midrange
October 12, 2015, 11:41 PM
Latest Blog Posts
Sceptre Airs 27", 120 Hz. 1080p Monitor/HDTV w/ 5 ms Response Time for $220
Dec 3, 2014, 10:32 PM
Costco Gives Employees Thanksgiving Off; Wal-Mart Leads "Black Thursday" Charge
Oct 29, 2014, 9:57 PM
"Bear Selfies" Fad Could Turn Deadly, Warn Nevada Wildlife Officials
Oct 28, 2014, 12:00 PM
The Surface Mini That Was Never Released Gets "Hands On" Treatment
Sep 26, 2014, 8:22 AM
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
More Blog Posts
Copyright 2016 DailyTech LLC. -
Terms, Conditions & Privacy Information