Citizens Communications, a Stamford, Conn.-based telecommunications company with over USD2 billion in revenue, has entered an interest-rate swap to convert USD100 million of fixed-rate debt into a synthetic floating-rate liability. It is the telecommunications company's first interest-rate swap since announcing that it is in discussions with several investment banks about entering fixed to floating interest-rate swaps (DW, 10/1), said Don Armour, treasurer and v.p. of finance. Armour said the company is considering entering more interest-rate swaps in the future, but has yet to determine the specific timing of the deals.
Armour said the company entered the interest-rate swap on a portion of the USD1.75 billion bond offering it issued in August 2000. The offering comprised USD300 million of 6.375% notes due in 2004, USD750 million of 7.625% notes due 2008 and USD700 million of 9% notes due in 2031. The swap matures in 2004.
The proceeds from the offerings were used to refinance outstanding bank debt. Standard & Poor's rates Citizens' senior unsecured debt BBB. Citizens has a USD4.5 billion debt portfolio.
