The Ericsson Bond Exchange Offer, announced on November 4, 2003, closed at 11.00 a.m. (London) today. The transaction was well received by the bond market, raising total acceptances of 433,818,000. Participants in the Bond Exchange Offer have exchanged their existing holdings in the Ericsson 6.375% Euro Medium Term Notes maturing May 31, 2006 (the "Notes") for a new seven-year bond, which is callable after 4 years.
The new bond will pay a coupon of 6.75% and was priced to yield 285 bps (annually) over the DBR 5.25% maturing January 4, 2011. Holders of the Notes were offered new bonds at a ratio of 1:1.0855. This ratio generates a principal size of 470,856,000 for the new 6.75% notes maturing November 28, 2010 (net of bond rounding amounts, to be paid in cash).
The Bond Exchange Offer has significantly extended Ericsson's debt maturity profile and has allowed Ericsson to take advantage of excellent credit and interest rate market conditions without raising additional cash.
"We are very pleased with the outcome of the Bond Exchange Offer," said Vidar Mohammar, Ericsson Corporate Treasurer. "The offer has achieved excellent financing terms for Ericsson and increased our financial flexibility."
The Ericsson exchange offer settles on November 28, 2003. Participants will receive their allocations of new bonds plus accrued interest and any rounding amounts in cash. The offer was open only to professional investors.
This press release is not for publication or distribution in whole or in part, directly or indirectly, in or into the United States. This notice is intended to be communicated only to creditors of Ericsson and relates only to the Ericsson Securities and the Ericsson Exchange Securities.