Zebra Technologies plans to redeem all 7¼% notes due 2022 by year-end

By Wendy Van Sickle

Columbus, Ohio, July 26 – Zebra Technologies Corp. plans to redeem the final $300 million of its $1.05 billion 7¼% senior notes due Oct. 15, 2022 by the end of 2017, according to a press release.

The company previously called $750 million of the notes for redemption on Aug. 7 at par plus a make-whole premium plus accrued interest to, but excluding, the redemption date. Those notes will be redeemed using proceeds of a new $687.5 million term A loan and a newly enlarged $500 million revolving credit facility.

The remaining $300 million of notes will be redeemed “by the end of 2017 through lower-cost financing arrangements, including an accounts receivable securitization facility,” according to Wednesday’s release.

“We are taking advantage of a favorable credit market to reduce our cost of capital and drive shareholder value,” Zebra’s chief financial officer, Olivier Leonetti, said in the release.

“This comprehensive debt restructuring reduces our weighted average pre-tax interest rate on approximately $2.5 billion total debt outstanding by approximately 2 percentage points to below 4%, and drives more than $45 million of annual cash interest savings. Zebra's capital structure allows payment flexibility as we continue to delever our balance sheet.”

The printing technologies company is based in Lincolnshire, Ill.

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