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Financing Arrangements | 12 Months Ended
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Apr. 28, 2017
Debt Disclosure [Abstract] |
Financing Arrangements | Financing Arrangements Current debt obligations consisted of the following:
(in millions) |  | April 28, 2017 |  | April 29, 2016
Bank borrowings |  | $ | 396 |  |  | $ | 387 |
Capital lease obligations |  | 5 |  |  | 106 |
Commercial paper |  | 901 |  |  | — |
Three-year term loan |  | 3,000 |  |  | — |
6.000 percent ten-year 2008 CIFSA senior notes |  | 1,150 |  |  | — |
1.500 percent three-year 2015 senior notes |  | 1,000 |  |  | — |
1.375 percent five-year 2013 senior notes |  | 1,000 |  |  | — |
3.500 percent seven-year 2010 HTWR senior notes |  | 42 |  |  | — |
Floating rate three-year 2014 senior notes |  | — |  |  | 250 |
0.875 percent three-year 2014 senior notes |  | — |  |  | 250 |
Debt premium, net |  | 26 |  |  | — |
Current debt obligations |  | $ | 7,520 |  |  | $ | 993 |
Commercial Paper On January 26, 2015, Medtronic Global Holdings S.C.A. (Medtronic Luxco), an entity organized under the laws of Luxembourg, entered into various agreements pursuant to which Medtronic Luxco may issue unsecured commercial paper notes (the 2015 Commercial Paper Program) on a private placement basis up to a maximum aggregate amount outstanding at any time of $3.5 billion. The Company and Medtronic, Inc. have guaranteed the obligations of Medtronic Luxco under the 2015 Commercial Paper Program. At April 28, 2017, the Company had $901 million of commercial paper outstanding. No amount of commercial paper was outstanding at April 29, 2016. During fiscal years 2017 and 2016, the weighted average original maturity of the commercial paper outstanding was approximately 39 days and 49 days, respectively, and the weighted average interest rate was 0.89 percent and 0.57 percent, respectively. The issuance of commercial paper reduces the amount of credit available under the Company's existing line of credit. Bank Borrowings Outstanding bank borrowings at April 28, 2017 were short-term advances to certain non-U.S. subsidiaries under credit agreements with various banks. Bank borrowings consist primarily of borrowings in Japanese Yen at interest rates ranging from 0.17% to 0.18%, and the borrowing is a natural hedge of currency and exchange rate risk. Line of Credit The Company has a $3.5 billion five year revolving syndicated line of credit facility ($3.5 Billion Revolving Credit Facility), by and among Medtronic, Medtronic, Inc., Medtronic Luxco, the lenders from time to time party thereto and Bank of America, N.A., as administrative agent and issuing bank, which expires in January 2020. The $3.5 Billion Revolving Credit Facility provides the Company with the ability to increase its borrowing capacity by an additional $500 million at any time during the term of the agreement. At each anniversary date of the $3.5 Billion Revolving Credit Facility, but not more than twice prior to the maturity date, the Company could also request a one-year extension of the maturity date. The Company, Medtronic Luxco, and Medtronic, Inc. guarantee the obligations under the Amended and Restated Revolving Credit Agreement. At April 28, 2017 and April 29, 2016, no amounts were outstanding on the committed line of credit. Interest rates on advances on the Credit Facility are determined by a pricing matrix, based on the Company’s long-term debt ratings, assigned by Standard & Poor’s Ratings Services and Moody’s Investors Service. Facility fees are payable on the Credit Facility and are determined in the same manner as the interest rates. The agreements also contain customary covenants, all of which the Company remained in compliance with at April 28, 2017. Long-term debt consisted of the following:
|  |  | April 28, 2017 |  | April 29, 2016
(in millions, except interest rates) | Maturity by Fiscal Year |  | Payable |  | Effective Interest Rate |  | Payable |  | Effective Interest Rate
6.000 percent ten-year 2008 CIFSA senior notes | 2018 |  | $ | — |  |  | 1.41 | % |  | $ | 1,150 |  |  | 1.41 | %
1.375 percent five-year 2013 senior notes | 2018 |  | — |  |  | 1.41 |  |  | 1,000 |  |  | 1.41 |
1.500 percent three-year 2015 senior notes | 2018 |  | — |  |  | 1.59 |  |  | 1,000 |  |  | 1.59 |
5.600 percent ten-year 2009 senior notes | 2019 |  | 400 |  |  | 5.61 |  |  | 400 |  |  | 5.61 |
1.700 percent two-year 2017 senior notes | 2019 |  | 1,000 |  |  | 1.74 |  |  | — |  |  | — |
4.450 percent ten-year 2010 senior notes | 2020 |  | 766 |  |  | 4.47 |  |  | 766 |  |  | 4.47 |
2.500 percent five-year 2015 senior notes | 2020 |  | 2,500 |  |  | 2.52 |  |  | 2,500 |  |  | 2.52 |
Floating rate five-year 2015 senior notes | 2020 |  | 500 |  |  | 1.98 |  |  | 500 |  |  | 1.04 |
4.200 percent ten-year 2010 CIFSA senior notes | 2021 |  | 600 |  |  | 2.22 |  |  | 600 |  |  | 2.22 |
4.125 percent ten-year 2011 senior notes | 2021 |  | 500 |  |  | 4.19 |  |  | 500 |  |  | 4.19 |
3.125 percent ten-year 2012 senior notes | 2022 |  | 675 |  |  | 3.16 |  |  | 675 |  |  | 3.16 |
3.150 percent seven-year 2015 senior notes | 2022 |  | 2,500 |  |  | 3.18 |  |  | 2,500 |  |  | 3.18 |
3.200 percent ten-year 2012 CIFSA senior notes | 2023 |  | 650 |  |  | 2.66 |  |  | 650 |  |  | 2.66 |
2.750 percent ten-year 2013 senior notes | 2023 |  | 530 |  |  | 2.78 |  |  | 530 |  |  | 2.78 |
2.950 percent ten-year 2013 CIFSA senior notes | 2024 |  | 310 |  |  | 2.67 |  |  | 310 |  |  | 2.67 |
3.625 percent ten-year 2014 senior notes | 2024 |  | 850 |  |  | 3.65 |  |  | 850 |  |  | 3.65 |
3.500 percent ten-year 2015 senior notes | 2025 |  | 4,000 |  |  | 3.61 |  |  | 4,000 |  |  | 3.61 |
3.350 percent ten-year 2017 senior notes | 2027 |  | 850 |  |  | 3.35 |  |  | — |  |  | — |
4.375 percent twenty-year 2015 senior notes | 2035 |  | 2,382 |  |  | 4.44 |  |  | 2,382 |  |  | 4.44 |
6.550 percent thirty-year 2007 CIFSA senior notes | 2038 |  | 374 |  |  | 3.75 |  |  | 374 |  |  | 3.75 |
6.500 percent thirty-year 2009 senior notes | 2039 |  | 300 |  |  | 6.52 |  |  | 300 |  |  | 6.52 |
5.550 percent thirty-year 2010 senior notes | 2040 |  | 500 |  |  | 5.56 |  |  | 500 |  |  | 5.56 |
4.500 percent thirty-year 2012 senior notes | 2042 |  | 400 |  |  | 4.51 |  |  | 400 |  |  | 4.51 |
4.000 percent thirty-year 2013 senior notes | 2043 |  | 325 |  |  | 4.12 |  |  | 325 |  |  | 4.12 |
4.625 percent thirty-year 2014 senior notes | 2044 |  | 650 |  |  | 4.67 |  |  | 650 |  |  | 4.67 |
4.625 percent thirty-year 2015 senior notes | 2045 |  | 4,150 |  |  | 4.62 |  |  | 4,000 |  |  | 4.64 |
Three-year term loan | 2018 |  | — |  |  | — |  |  | 3,000 |  |  | 1.12 |
Interest rate swaps | 2021-2022 |  | 40 |  |  | — |  |  | 89 |  |  | — |
Capital lease obligations | 2019-2025 |  | 23 |  |  | 4.81 |  |  | 26 |  |  | 4.66 |
Bank borrowings | 2019-2022 |  | 139 |  |  | 1.28 |  |  | 56 |  |  | 6.46 |
Debt premium, net | 2019-2045 |  | 135 |  |  | — |  |  | 214 |  |  | — |
Deferred financing costs | 2019-2045 |  | (128 | ) |  | — |  |  | (138 | ) |  | — |
Long-term debt |  |  | $ | 25,921 |  |  |  |  |  | $ | 30,109 |  |  |  |
Senior Notes The Company had outstanding unsecured senior obligations, including those described as senior notes in the long-term debt table above (collectively, the Senior Notes). The Senior Notes rank equally with all other unsecured and unsubordinated indebtedness of the Company. The indentures under which the Senior Notes were issued contain customary covenants, all of which the Company remained in compliance with at April 28, 2017. The Company used the net proceeds from the sale of the Senior Notes primarily for general corporate purposes, which includes the repayment of other indebtedness of the Company. In March 2017, Medtronic Luxco issued two tranches of Senior Notes with an aggregate face value of $1.850 billion (collectively, the 2017 Senior Notes). The first tranche consisted of $1.0 billion of 1.700 percent Senior Notes due 2019. The second tranche consisted of $850 million of 3.350 percent Senior Notes due 2027. Concurrent with the offering by Medtronic Luxco, Medtronic, Inc. issued $150 million in principal amount of its 4.625 percent Senior Notes due 2045 (the Reopening Notes). The Reopening Notes are a further issuance of, and form a single series with, the $4.0 billion principal amount of Medtronic, Inc.'s previously outstanding 4.625 percent Senior Notes due 2045. Interest on the 2017 Senior Notes and the Reopening Notes is payable semi-annually. The Company used the net proceeds from the sale of the 2017 Senior Notes and the Reopening Notes for general corporate purposes. In April 2016, the Company completed a cash tender offer and redemption of $2.7 billion of senior notes for $3.0 billion of total consideration. We recognized a loss on debt extinguishment of $163 million, which included cash premiums and accelerated amortization of deferred financing costs and debt discounts and premiums. The loss on debt extinguishment was recognized in interest expense, net in the consolidated statements of income. In addition to the loss on debt extinguishment, we recognized $20 million of interest expense due to the acceleration of net losses on forward starting interest rate derivatives, which were terminated at the time of original debt issuances relating to the portion of debt extinguished in the tender offer. At April 28, 2017 and April 29, 2016, the Company had interest rate swap agreements designated as fair value hedges of certain underlying fixed-rate obligations, including the Company’s $500 million 4.125 percent 2011 Senior Notes and $675 million 3.125 percent 2012 Senior Notes. Refer to Note 9 for additional information regarding the interest rate swap agreements. Term Loan On January 26, 2015, Medtronic, Inc. borrowed $3.0 billion for a term of three years under a senior unsecured term loan credit agreement (the “Term Loan Credit Agreement”), among Medtronic, Inc., Medtronic, Medtronic Luxco, the lenders from time to time party thereto and Bank of America, N.A., as administrative agent. The Term Loan Credit Agreement was entered into to finance, in part, the cash component of the acquisition of Covidien and certain transaction expenses. Medtronic and Medtronic Luxco have guaranteed the obligations of Medtronic, Inc. under the Term Loan Credit Agreement. Contractual maturities of debt for the next five fiscal years and thereafter, excluding deferred financing costs, debt premium, net, and the fair value of outstanding interest rate swap agreements are as follows:
(in millions) |
2018 | $ | 7,494 |
2019 | 1,403 |
2020 | 3,778 |
2021 | 1,127 |
2022 | 3,276 |
Thereafter | 16,290 |
Total debt | 33,368 |
Less: Current portion of debt | 7,494 |
Long-term portion of debt | $ | 25,874 |
Financial Instruments Not Measured at Fair Value At April 28, 2017, the estimated fair value of the Company’s Senior Notes, including the current portion, was $30.4 billion compared to a principal value of $28.9 billion. At April 29, 2016 the estimated fair value was $29.8 billion compared to a principal value of $27.4 billion. Fair value was estimated using quoted market prices for the publicly registered senior notes, classified as Level 2 within the fair value hierarchy. The fair values and principal values consider the terms of the related debt and exclude the impacts of debt discounts and derivative/hedging activity.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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