Xerox Raises $700 Million Through Senior Note Offering
STAMFORD, Conn., March 20, 2006 -- Xerox Corporation (NYSE: XRX) closed today on a $700 million offering of senior unsecured notes due in 2016 and bearing a coupon of 6.4 percent. The offering for the notes, which was announced last week, exceeded the company’s initial expectations.
“Investors’ interest in this offering reflects confidence in Xerox’s healthy financial position and our ability to execute effectively on a strategy that delivers shareholder value,” said Lawrence A. Zimmerman, Xerox senior vice president and chief financial officer. “The offering was quickly over subscribed and the resulting $700 million transaction gives the company flexibility to fund our customer financing activities with more unsecured debt than secured debt - an important step in returning Xerox to investment grade.”
Earlier this month, Standard & Poor’s Rating Services gave Xerox a double upgrade, noting the company’s “substantial debt reduction, good cash flow and growth in equipment sales.”
Xerox generated $1.4 billion in operating cash flow last year. The company ended 2005 with a cash and short-term investment balance of $1.6 billion and a debt balance of $7.3 billion, which was a $2.8 billion reduction from year-end 2004.
Zimmerman added that Xerox’s financial strength allows the company to access the markets on an opportunistic basis, taking advantage of favorable conditions to lock in attractive long-term interest rates as it did with this senior note offering.
NOTE TO EDITORS: This release contains “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. These statements reflect management’s current beliefs and expectations, and are subject to a number of factors that may cause actual results to differ materially. Such factors include, but are not limited to, our consummation of the transactions as described herein. Information concerning these factors is included in the company’s 2005 Form 10-K filed with the SEC. The company assumes no obligation to update any forward-looking statements as a result of new information or future events or developments.
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