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Debt | 9 Months Ended
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Jun. 30, 2020
Debt Disclosure [Abstract] |
Debt | NOTE H – DEBT The following table summarizes Ashland’s current and long-term debt as of the dates reported in the Condensed Consolidated Balance Sheets.
(In millions) |  | June 30, 2020 |  |  | September 30, 2019 |
4.750% notes, due 2022 |  | $ | 411 |  |  | $ | 1,080 |
2.00% Senior Notes, due 2028 (Euro 500 million principal) |  |  | 561 |  |  |  | — |
6.875% notes, due 2043 |  |  | 282 |  |  |  | 374 |
Term loan A, due 2025 |  |  | 250 |  |  |  | — |
Accounts receivable securitizations |  |  | 194 |  |  |  | 144 |
6.50% junior subordinated notes, due 2029 |  |  | 54 |  |  |  | 54 |
Revolving credit facility |  |  | 230 |  |  |  | — |
Other (a) |  |  | 11 |  |  |  | 15 |
Total debt |  |  | 1,993 |  |  |  | 1,667 |
Short-term debt (includes current portion of long-term debt) |  |  | (446 | ) |  |  | (166 | )
Long-term debt (less current portion) |  | $ | 1,547 |  |  | $ | 1,501 |
| (a) | Includes $15 million and $12 million of debt issuance cost discounts as of June 30, 2020 and September 30, 2019, respectively. Additionally, as of both June 30, 2020 and September 30, 2019, Other included a European short-term loan facility with an outstanding balance of $22 million. |
The scheduled aggregate maturities of long-term debt by year (including the current portion and excluding debt issuance costs) are as follows as of June 30, 2020: zero remaining in 2020, zero in 2021, $421 million in 2022, $22 million in 2023 and $44 million in 2024. Ashland Financing Activities Credit Agreements and Refinancing During January 2020, Ashland LLC and Ashland Services B.V., indirect wholly owned subsidiaries of Ashland, entered into a new senior unsecured credit agreement (the 2020 Credit Agreement) with a group of lenders, replacing the 2017 Credit Agreement. The 2020 Credit Agreement provides for (i) a $600 million unsecured five-year revolving credit facility (the revolving credit facility) and (ii) a $250 million unsecured five-year term loan facility (the term loan facility). The 2020 Credit Agreement is guaranteed by Ashland Global Holdings Inc. and Ashland Chemco Inc., and the obligations of Ashland Services B.V. under the revolving credit facility are guaranteed by Ashland LLC. The 2020 Credit Agreement contains financial covenants for leverage and interest coverage ratios akin to those in effect under the 2017 Credit Agreement. The 2020 Credit Agreement contains usual and customary representations, warranties and affirmative and negative covenants, including financial covenants for leverage and interest coverage ratios, limitations on liens, additional indebtedness, further negative pledges, investments, mergers, sale of assets and restricted payments, and other customary limitations. Ashland incurred $4 million of new debt issuance costs in connection with the 2020 Credit Agreement, of which $1 million was expensed immediately during the nine months ended June 30, 2020 within the net interest and other expense caption of the Statements of Consolidated Comprehensive Income (Loss). The remaining balance is amortized using either the effective interest method or straight-line method. Additionally, as a result of the termination of the 2017 Credit Agreement, Ashland recognized a $1 million charge for the accelerated amortization of previously capitalized debt issuance costs during the nine months ended June 30, 2020, which is included in the net interest and other expense caption of the Statements of Consolidated Comprehensive Income (Loss). Note Issuance and existing notes tender During January 2020, a subsidiary of Ashland, Ashland Services B.V., completed the issuance of 2.00% senior unsecured notes due 2028 with an aggregate principal amount of €500 million (the 2028 Notes). The notes are senior unsecured obligations of Ashland Services B.V and initially guaranteed on an unsecured basis by each of Ashland Global Holdings Inc. and Ashland LLC. Ashland used the net proceeds of the offering (after deducting initial purchasers’ discounts and other fees and expenses), together with the proceeds of the new term loan facility and other funds of Ashland LLC or its subsidiaries, to repurchase the existing notes described below in cash tender offers, and to pay fees and expenses associated therewith. Ashland incurred $8 million of new debt issuance costs in connection with the 2028 Notes, which is amortized using the effective interest method over the Notes’ term. Tender offers of 4.750% notes due 2022 During the nine months ended June 30, 2020, Ashland executed tender offers of its 4.750% notes due 2022 (the 2022 Notes). As a result of these repurchases, the carrying values of the 2022 notes was reduced by $670 million. Ashland recognized a $5 million charge related to accelerated accretion on debt discounts and accelerated amortization of previously capitalized debt issuance costs, which is included in the net interest and other expense caption of the Statements of Consolidated Comprehensive Income (Loss) for the nine months ended June 30, 2020. Tender offers of 6.875% notes due 2043 During the nine months ended June 30, 2020, Ashland executed tender offers of its 6.875% notes due 2043 (the 2043 Notes). As a result of these repurchases, the carrying values of the 2043 notes was reduced by $92 million. Ashland recognized a $1 million charge related to accelerated accretion on debt premiums and accelerated amortization previously capitalized debt issuance costs, which is included in the net interest and other expense caption of the Statements of Consolidated Comprehensive Income (Loss) for the nine months ended June 30, 2020. Tender offers of 6.500% Junior Subordinated Debentures due 2029 During the nine months ended June 30, 2020, Ashland executed tender offers of Hercules LLC’s 6.500% notes due 2029 (the 2029 Junior Debentures). As a result of these repurchases, the carrying values of the 2029 notes was reduced by $2 million. Total premiums paid for all tender offers noted above were $59 million, which is in included in the net interest and other expenses caption of the Statements of Consolidated Comprehensive Income (Loss) for the nine months ended June 30, 2020. Available borrowing capacity The borrowing capacity remaining under the 2020 $600 million Revolving Credit Facility was $350 million due to an outstanding balance of $230 million, as well as a reduction of $20 million for letters of credit outstanding as of June 30, 2020. Ashland's total borrowing capacity at June 30, 2020 was $350 million, which included zero of available capacity from the two accounts receivable securitization facilities. Covenants related to current Ashland debt agreements Ashland's debt contains usual and customary representations, warranties and affirmative and negative covenants, including financial covenants for leverage and interest coverage ratios, limitations on liens, additional subsidiary indebtedness, restrictions on subsidiary distributions, investments, mergers, sale of assets and restricted payments and other customary limitations. As of June 30, 2020, Ashland is in compliance with all debt agreement covenant restrictions. The maximum consolidated net leverage ratio permitted under Ashland's most recent credit agreement (the 2020 Credit Agreement) is 4.0. At June 30, 2020, Ashland’s calculation of the consolidated net leverage ratio was 3.0. The minimum required consolidated interest coverage ratio under the 2020 Credit Agreement during its entire duration is 3.0. At June 30, 2020, Ashland’s calculation of the interest coverage ratio was 7.7.

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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