Taking advantage of lower interest rates, Cooper Companies has refinanced its debt and expects the deal to trim earnings per share by $0.14 in the 2011 fiscal year. Excluding debt extinguishment costs of approximately $17.3 million the transaction would have to boost EPS by $0.08.
Cooper has entered into a new $1 billion 5-year senior unsecured credit facility, consisting of a $750 million revolving line of credit and a $250 million loan. The company will use some of the funds to reimburse all $339 million of its 7.125% senior notes due 2015. The redemption date of the notes is Feb, 15, 2011 and there price is 103.563 percent of the principal amount of the notes, plus accrued interest to February 15.
Cooper will use the credit facility to finance its working capital and other purposes, including the refinancing of the existing revolving credit line of $650 million that matures on Jan. 31, 2012. Following the refinancing and buyback, the company expects total interest expense of approximately $25 million in the 2011 fiscal year.
The company also announced the payment on Feb.7 of a semi-annual dividend of $0.03 per share.