Posts Tagged ‘debentures’

Dig These QVC Parent Liberty Media Dentures, Whoops We Mean Debentures

January 18, 2011

For those who think that our home-shopping coverage is frivolous, here’s some real financial news. But you have to be a CFO to figure it out.

QVC’s parent, cable cowboy John Malone’s Liberty Media, Tuesday announced a semi-annual payment to the holders of its 3.5 percent senior exchangeable debentures due in 2031. The amount of the payment is $17.50 per $1,000 of original principal amount of the debentures.

This semi-annual payment will result in the further reduction of the adjusted principal amount of the debentures. As previously announced, the principal amount of the debentures was reduced in the amount of $162.616 per debenture, resulting in an adjusted principal amount equal to $837.384 per debenture.

This adjustment resulted from an extraordinary distribution of cash that was paid to bondholders on January 10, 2007 in accordance with the indenture governing the debentures.

This extraordinary distribution arose from Freescale Semiconductor’s merger with an entity controlled by a consortium of private equity firms in exchange for cash.

At that time, Liberty announced that, in accordance with the indenture, the adjusted principal amount of the debentures would be further reduced on each successive semi-annual interest payment date to the extent necessary to cause the semi-annual payment on that date to represent the payment by Liberty, in arrears, of an annualized yield of 3.5 percent of the adjusted principal amount of the debentures.

The adjustments described above will not affect the amount of the semi-annual payments received by holders of the debentures, which will continue to be a rate equal to 3.5 per cent per annum of the original principal amount of the debentures.

The semi-annual interest payment and additional distribution are expected to be made on Jan. 18, 2011 to holders of record of the debentures Jan. 1, 2011.