Ford Calls Convertible Securities; Wright Medical Group Begins Tender Offer
With the earnings season almost behind us, companies are aggressively seeking ways to improve their balance sheets. Ford Motor Company (F) continues to reduce its debt level with the redemption of two convertible securities. Meanwhile, Wright Medical Group (WMGI) began a tender offer to buy back any and all of its 2.625% convertible senior notes for cash.
Ford Motor Company’s performance in the final quarter of 2010 was disappointing both at home and abroad. Its European operations reported a $50 million loss. While volume and pricing picked up in the U.S., costs related to new vehicle introductions soared. For the period, share net of $0.30 was 30% lower than the previous year’s like period, and 37% less than Value Line estimated. In light of the disappointing performance, Ford continues to trim its debt load. It took $15 billion off the books in 2010, and has earmarked another $3 billion via the redemption its 6.5% Junior Subordinated Convertible Securities and its 6.5% Cumulative Convertible Trust Preferred Securities in March.
At the time of this writing, the author did not have positions in any of the companies mentioned.