XML 34 R17.htm IDEA: XBRL DOCUMENT
v3.20.4

Debt | 12 Months Ended
--- | ---
Dec. 31, 2020
Debt Disclosure [Abstract] |
Debt | Debt The following is a summary of outstanding debt at December 31, (in millions):
| 2020 |  | 2019
4.70% senior notes due 2020 | $ | — |  |  | $ | 305 |
3.15% senior notes due 2021 | 94 |  |  | 94 |
3.75% senior notes due 2021 | 369 |  |  | 342 |
4.00% senior notes due 2022 | 250 |  |  | 249 |
3.85% senior notes due 2023 | 1,090 |  |  | 1,388 |
4.00% senior notes due 2024 | 200 |  |  | 199 |
4.875% senior notes due 2025 | 492 |  |  | — |
3.90% senior notes due 2025 | 47 |  |  | 47 |
4.20% senior notes due 2026 | 1,973 |  |  | 1,986 |
5.375% senior notes due 2036 | 416 |  |  | 416 |
5.50% senior notes due 2046 | 657 |  |  | 657 |
Commercial paper | — |  |  | 25 |
Other debt | 19 |  |  | 15 |
Total debt | 5,607 |  |  | 5,723 |
Short-term debt and current portion of long-term debt | (466) |  |  | (332) |
Long-term debt | $ | 5,141 |  |  | $ | 5,391 |
Credit Revolver and Commercial Paper On November 1, 2019, S&P Global Inc. ("S&P") downgraded the Company’s debt rating to “BB+” as S&P believed the Company would fail to meet S&P’s target debt level for 2019. In addition, on March 9, 2020, Moody’s Corporation ("Moody’s") downgraded the Company’s debt rating to “Ba1” based on a view that the Company would fail to meet Moody's target debt level for 2020. Subsequently on April 15, 2020, Fitch Ratings ("Fitch") downgraded the Company’s debt rating to "BB" as they believed the Company would fail to meet Fitch's target debt level for 2020. As a result of the S&P and Moody's downgrades, the Company could no longer borrow from the commercial paper market on terms it deems acceptable or favorable. Previously, the Company was able to issue commercial paper up to a maximum of $800 million provided there was a sufficient amount available for borrowing under the Company’s $1.25 billion revolving credit facility that matures in December 2023 (“the Credit Revolver”). The Company’s ability to borrow under the Credit Revolver was not affected by the downgrades. The interest rate for borrowings under the Credit Revolver is the borrowing period referenced LIBOR rate plus 127.5 basis points. At December 31, 2020 and 2019, the Company did not have any amounts outstanding under the Credit Revolver. Senior Notes In May 2020, the Company completed a registered public offering of $500 million in aggregate principal amount of 4.875% senior notes that mature in June 2025 (the “June 2025 Notes”) and received proceeds of approximately $491 million, net of fees and expenses paid. The June 2025 Notes are subject to similar restrictive and financial covenants as the Company’s existing senior notes, however, they are not subject to the interest rate adjustment or coupon step up provisions of certain other notes described below. The June 2025 Notes are redeemable in whole or in part, at the option of the Company (1) at any time prior to one month before the stated maturity at a redemption price equal to the greater of (a) 100% of the principal amount or (b) the discounted present value of principal and interest at the Treasury Rate plus 50 basis points, plus accrued interest to but excluding the redemption date; or (2) at any time on or after one month prior to the stated maturity at a price equal to 100% of the principal amount being redeemed, plus accrued interest to but excluding the redemption date. The Company used the net proceeds from the June 2025 Notes for general corporate purposes, including repayment of outstanding borrowings under the Credit Revolver and accounts receivable securitization facility, and the redemption of the outstanding 4.70% Senior Notes due in August 2020 at maturity. In March 2020, the Company repurchased $15 million of the 4.20% senior notes due 2026 at approximately par value. The total consideration, excluding accrued interest, was approximately $15 million. As a result of the partial debt extinguishment, the Company recorded an immaterial loss. In November 2020, the Company repurchased $300 million of the 3.85% Senior Notes due 2023 with available cash on hand. The total consideration, excluding accrued interest, was approximately $318 million. The Company recorded a loss on extinguishment of debt of $20 million as a result of the partial debt repayment. On January 25, 2021, the Company delivered a notice of redemption to the holders of the 3.15% senior notes that will mature in April 2021 (the “April 2021 Notes”) that the Company will redeem the April 2021 Notes on March 1, 2021 (the “Redemption Date”) for a redemption price equal to 100% of the current outstanding aggregate principal amount of the notes, plus accrued and unpaid interest to the Redemption Date. As a result of the aforementioned debt rating downgrades by Moody's and S&P, certain of the Company’s outstanding senior notes aggregating to approximately $4.3 billion are subject to an interest rate adjustment of 25 basis points as a result of each downgrade, for a total of 50 basis points. This increase to the interest rates of each series of the Company's senior notes subject to adjustment, increased the Company’s interest expense for 2020 by approximately $17 million and expected to increase by approximately $21 million thereafter, on an annualized basis. The Fitch downgrade did not impact the interest rates on any of the Company's senior notes. Receivables Facility The Company maintains an Accounts Receivable Securitization Facility (the “Securitization Facility”). The aggregate commitment under the Securitization Facility is $600 million. The Securitization Facility matures in October 2022 and bears interest at a margin over a variable interest rate. The maximum availability under the Securitization Facility fluctuates based on eligible accounts receivable balances. In March 2020, the Company amended its Securitization Facility with respect to certain customer receivables and to remove an originator from the Securitization Facility. At December 31, 2020, the Company did not have any amounts outstanding under the Securitization Facility. Future Debt Maturities The Company’s debt maturities for the five years following December 31, 2020 and thereafter are as follows (in millions):
2021 |  | 2022 |  | 2023 |  | 2024 |  | 2025 |  | Thereafter |  | Total
$465 |  | $253 |  | $1,095 |  | $201 |  | $547 |  | $3,072 |  | $5,633
Other In connection with the ATP, the Company completed the sale of several businesses during 2019. In 2019, the Company sold: its Process Solutions business, Rexair, The Playing Cards Company and other related subsidiaries. As a result of these transactions, the Company received gross proceeds of $996 million in 2019, most of which was used to pay down debt. The indentures governing the Company’s senior notes contain usual and customary nonfinancial covenants. The Company’s borrowing arrangements other than the senior notes contain usual and customary nonfinancial covenants and certain financial covenants, including minimum interest coverage and maximum debt-to-total-capitalization ratios. At December 31, 2020 and 2019, unamortized deferred debt issue costs were $29 million and $33 million, respectively. These costs are included in total debt and are being amortized over the respective terms of the underlying debt. The fair values of the Company’s senior notes are based on quoted market prices and are as follows at December 31, (in millions):
| 2020 |  | 2019
| Fair Value |  | Book Value |  | Fair Value |  | Book Value
Senior notes | $ | 6,277 |  |  | $ | 5,588 |  |  | $ | 5,990 |  |  | $ | 5,683 |
The carrying amounts of all other significant debt approximates fair value. Net Investment Hedge The Company has designated the €300 million principal balance of the 3.75% senior notes due October 2021 as a net investment hedge of the foreign currency exposure of its net investment in certain Euro-functional currency subsidiaries with Euro-denominated net assets. At December 31, 2020, $26 million of deferred losses have been recorded in AOCL. See Footnote 10 for disclosures regarding the Company’s derivative financial instruments.

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