XML 28 R10.htm IDEA: XBRL DOCUMENT
v3.10.0.1

Debt and Credit Agreements (Notes) | 12 Months Ended
--- | ---
Dec. 31, 2018
Debt Disclosure [Abstract] |
Debt Disclosure [Text Block] | Debt and Credit Arrangements Long-Term Debt A summary of the carrying amounts and fair values of our long-term debt is listed below.
| Effective Interest Rate |  | December 31,
2018 |  | 2017
| Book Value |  | Fair Value 1 |  | Book Value |  | Fair Value 1
3.50% Senior Notes due 2020 (less unamortized discount and issuance costs of $0.8 and $2.6, respectively) | 3.89 | % |  | $ | 496.6 |  |  | $ | 499.9 |  |  | $ | — |  |  | $ | — |
3.75% Senior Notes due 2021 (less unamortized discount and issuance costs of $0.3 and $2.9, respectively) | 3.98 | % |  | 496.8 |  |  | 503.2 |  |  | — |  |  | — |
4.00% Senior Notes due 2022 (less unamortized discount and issuance costs of $1.0 and $0.8, respectively) | 4.13 | % |  | 248.2 |  |  | 250.3 |  |  | 247.6 |  |  | 259.0 |
3.75% Senior Notes due 2023 (less unamortized discount and issuance costs of $0.6 and $1.7, respectively) | 4.32 | % |  | 497.7 |  |  | 491.4 |  |  | 497.1 |  |  | 513.2 |
4.20% Senior Notes due 2024 (less unamortized discount and issuance costs of $0.5 and $2.2, respectively) | 4.24 | % |  | 497.3 |  |  | 492.6 |  |  | 496.7 |  |  | 524.2 |
4.65% Senior Notes due 2028 (less unamortized discount and issuance costs of $1.7 and $4.3, respectively) | 4.78 | % |  | 494.0 |  |  | 494.1 |  |  | — |  |  | — |
5.40% Senior Notes due 2048 (less unamortized discount and issuance costs of $2.8 and $5.5, respectively) | 5.48 | % |  | 491.7 |  |  | 474.1 |  |  | — |  |  | — |
Term Loan due 2021 - LIBOR plus 1.25% |  |  | 400.0 |  |  | 400.0 |  |  | — |  |  |
Other notes payable and capitalized leases |  |  | 38.0 |  |  | 38.0 |  |  | 46.2 |  |  | 46.2 |
Total long-term debt |  |  | 3,660.3 |  |  |  |  | 1,287.6 |  |  |
Less: current portion |  |  | 0.1 |  |  |  |  | 2.0 |  |  |
Long-term debt, excluding current portion |  |  | $ | 3,660.2 |  |  |  |  | $ | 1,285.6 |  |  |
1 | See Note 12 for information on the fair value measurement of our long-term debt.
Annual maturities are scheduled as follows based on the book value as of December 31, 2018.
2019 | $ | 0.1 |
2020 | 496.9 |
2021 | 896.8 |
2022 | 248.2 |
2023 | 497.7 |
Thereafter | 1,520.6 |
Total long-term debt | $ | 3,660.3 |
For those debt securities that have a premium or discount at the time of issuance, we amortize the amount through interest expense based on the maturity date or the first date the holders may require us to repurchase the debt securities, if applicable. A premium would result in a decrease in interest expense, and a discount would result in an increase in interest expense in future periods. Additionally, we have debt issuance costs related to certain financing transactions which are also amortized through interest expense. As of December 31, 2018 and 2017, we had total unamortized debt issuance costs of $26.0 and $13.0, respectively. Our debt securities include covenants that, among other things, limit our liens and the liens of certain of our consolidated subsidiaries, but do not require us to maintain any financial ratios or specified levels of net worth or liquidity. Debt Transactions See Note 6 for further information regarding the Company's acquisition of Acxiom (the "Acxiom Acquisition") on October 1, 2018 (the "Closing Date"). Senior Notes On September 21, 2018, in order to fund the Acxiom Acquisition and related fees and expenses, we issued a total of $2,000.0 in aggregate principal amount of unsecured senior notes (in four separate series of $500.0 each, together, the "Senior Notes"). Upon issuance, the Senior Notes were reflected on our Consolidated Balance Sheets net of discount of $5.8 and net of the capitalized debt issuance costs, including commissions and offering expenses of $16.1, both of which will be amortized in interest expense through the respective maturity dates of each series of Senior Notes using the effective interest method. Interest is payable semi-annually in arrears on April 1st and October 1st of each year, commencing on April 1, 2019. The issuance was comprised of the following four series of notes:
Senior Notes |  | Par Value |  | Discount at Issuance |  | Net Price at Issuance |  | Issuance Cost |  | Net Proceeds
3.50% Senior Notes due 2020 |  | $ | 500.0 |  |  | $ | 1.0 |  |  | $ | 499.0 |  |  | $ | 2.9 |  |  | $ | 496.1 |
3.75% Senior Notes due 2021 |  | 500.0 |  |  | 0.3 |  |  | 499.7 |  |  | 3.2 |  |  | 496.5 |
4.65% Senior Notes due 2028 |  | 500.0 |  |  | 1.7 |  |  | 498.3 |  |  | 4.4 |  |  | 493.9 |
5.40% Senior Notes due 2048 |  | 500.0 |  |  | 2.8 |  |  | 497.2 |  |  | 5.6 |  |  | 491.6 |
Total |  | $ | 2,000.0 |  |  | $ | 5.8 |  |  | $ | 1,994.2 |  |  | $ | 16.1 |  |  | $ | 1,978.1 |
Consistent with our other debt securities, the newly issued Senior Notes include covenants that, among other things, limit our liens and the liens of certain of our consolidated subsidiaries, but do not require us to maintain any financial ratios or specified levels of net worth or liquidity. We may redeem each series of the Senior Notes at any time in whole or from time to time in part in accordance with the provisions of the indenture, including the applicable supplemental indenture, under which such series of Senior Notes was issued. If the Acxiom Acquisition had been terminated or had not closed on or prior to June 30, 2019, we would have been required to redeem the Senior Notes due 2020, 2021 and 2028 at a redemption price equal to 101% of the principal amount thereof, plus accrued and unpaid interest. Additionally, upon the occurrence of a change of control repurchase event with respect to the Senior Notes, each holder of the Senior Notes has the right to require the Company to purchase that holder’s Senior Notes at a price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, unless the Company has exercised its option to redeem all the Senior Notes. Term Loan Agreement On October 1, 2018, in order to fund the Acxiom Acquisition and related fees and expenses, we borrowed $500.0 through debt financing arrangements with third-party lenders under a three-year term loan agreement (the "Term Loan Agreement"), $100.0 of which we paid down on December 3, 2018. Consistent with our other debt securities, the Term Loan Agreement includes covenants that, among other things, limit our liens and the liens of certain of our consolidated subsidiaries. In addition, it requires us to maintain the same financial maintenance covenants as discussed below. Loans under the Term Loan bear interest at a variable rate based on, at the Company’s option, either the base rate or the Eurodollar rate (each as defined in the Term Loan Agreement) plus an applicable margin that is determined based on our credit ratings. As of December 31, 2018, the applicable margin was 0.25% for base rate loans and 1.25% for Eurodollar rate loans. Credit Agreements We maintain a committed corporate credit facility, originally dated as of July 18, 2008, which has been amended and restated from time to time (the "Credit Agreement"). We use our Credit Agreement to increase our financial flexibility, to provide letters of credit primarily to support obligations of our subsidiaries and to support our commercial paper program. The Credit Agreement is a revolving facility, expiring in October 2022, under which amounts borrowed by us or any of our subsidiaries designated under the Credit Agreement may be repaid and reborrowed, subject to an aggregate lending limit of $1,500.0, or the equivalent in other currencies. The Company has the ability to increase the commitments under the Credit Agreement from time to time by an additional amount of up to $250.0, provided the Company receives commitments for such increases and satisfies certain other conditions. The aggregate available amount of letters of credit outstanding may decrease or increase, subject to a sublimit on letters of credit of $50.0, or the equivalent in other currencies. Our obligations under the Credit Agreement are unsecured. As of December 31, 2018 and 2017, there were no borrowings under the Credit Agreement; however, we had $8.5 and $8.4 of letters of credit under the Credit Agreement, which reduced our total availability to $1,491.5 and $1,491.6, respectively. On July 27, 2018, we entered into Amendment No. 1 to our Credit Agreement (the "Amendment"). The Amendment increased the maximum leverage ratio covenant to (i) 4.00 to 1.00 for the first, second and third fiscal quarters ending after the Acxiom Closing Date, (ii) 3.75 to 1.00 for the fourth, fifth, sixth and seventh full fiscal quarters ending after the Acxiom Closing Date and (iii) 3.50 to 1.00 for the eighth full fiscal quarter ending after the Acxiom Closing Date and thereafter. Under the Credit Agreement, we can elect to receive advances bearing interest based on either the base rate or the Eurocurrency rate (each as defined in the Credit Agreement) plus an applicable margin that is determined based on our credit ratings. As of December 31, 2018, the applicable margin was 0.10% for base rate advances and 1.10% for Eurocurrency rate advances. Letter of credit fees accrue on the average daily aggregate amount of letters of credit outstanding, at a rate equal to the applicable margin for Eurocurrency rate advances, and fronting fees accrue on the aggregate amount of letters of credit outstanding at an annual rate of 0.25%. We also pay a facility fee at an annual rate that is determined based on our credit ratings, which as of December 31, 2018, was 0.15% on the aggregate lending commitment under the Credit Agreement. In addition to other and customary covenants, the Credit Agreement and the Term Loan each require that we maintain the financial covenants listed below as of the end of each fiscal quarter for the period of four fiscal quarters then ended. We were in compliance with all of our covenants in the Credit Agreement and the Term Loan as of December 31, 2018.
Interest coverage ratio (not less than): 1 |  | 5.00x
Leverage ratio (not greater than): 2 |  | 4.00x
1 | The interest coverage ratio is defined as EBITDA, as defined in the Credit Agreement and Term Loan Agreement, to net interest expense for the four quarters then ended.
2 | The leverage ratio is defined as debt as of the last day of such fiscal quarter to EBITDA, as defined in the Amended Credit Agreement and Term Loan Agreement, for the four quarters then ended.
We also have uncommitted lines of credit with various banks that permit borrowings at variable interest rates and that are primarily used to fund working capital needs. We have guaranteed the repayment of some of these borrowings made by certain subsidiaries. If we lose access to these credit lines, we would have to provide funding directly to some of our operations. As of December 31, 2018 and 2017, the Company had uncommitted lines of credit in an aggregate amount of $1,173.1 and $926.2, under which we had outstanding borrowings of $73.7 and $84.9 classified as short-term borrowings on our Consolidated Balance Sheets, respectively. The average amounts outstanding during 2018 and 2017 were $96.4 and $223.8, respectively, with weighted-average interest rates of approximately 4.5% and 2.9%, respectively. Commercial Paper The Company is authorized to issue unsecured commercial paper up to a maximum aggregate amount outstanding at any time of $1,500.0. Borrowings under the commercial paper program are supported by the Credit Agreement described above. Proceeds of the commercial paper are used for working capital and general corporate purposes, including the repayment of maturing indebtedness and other short-term liquidity needs. The maturities of the commercial paper vary but may not exceed 397 days from the date of issue. As of December 31, 2018, there was no commercial paper outstanding. The average amount outstanding under the program was $648.7 in 2018, with a weighted-average interest rate of 2.4% and a weighted-average maturity of twenty-two days. Cash Pooling We aggregate our domestic cash position on a daily basis. Outside the United States, we use cash pooling arrangements with banks to help manage our liquidity requirements. In these pooling arrangements, several IPG agencies agree with a single bank that the cash balances of any of the agencies with the bank will be subject to a full right of set-off against amounts other agencies owe the bank, and the bank provides for overdrafts as long as the net balance for all agencies does not exceed an agreed-upon level. Typically, each agency pays interest on outstanding overdrafts and receives interest on cash balances. Our Consolidated Balance Sheets reflect cash, net of bank overdrafts, under all of our pooling arrangements, and as of December 31, 2018 and 2017 the amounts netted were $2,065.8 and $1,412.0, respectively.

X
- References No definition available. + Details
Name: | us-gaap_DebtDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
Name: | us-gaap_DebtDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration