Delhaize pays off "expensive" debts faster

Delhaize pays off "expensive" debts faster

Belgian supermarket chain Delhaize has bought back 450 million dollars (420 million euro) of debt over the past few days, which would lower its yearly interest burden by 21 million euro - according to ING.

4 to 6.5 % during a period of near-zero interest

Considering the current financial climate, Delhaize would be crazy to pay 4 to 6.5 % on its debt when current interest rates approach zero %. The company clearly had the same view, buying back 170 million dollars (out of a 300 million dollar loan) which would expire in 2019 and has a 4.125 % interest rate. On top of that, it has bought back 280 million dollars (out of a 450 million dollar loan) with an expiration date in 2017 and a 6.5 % interest rate.

 

Delhaize has to give its "debtors" an extra, but the surcharge pales to the savings it would realize: ING believes Delhaize could reduce its yearly interest 23 million dollars (21 million euro), business paper De Tijd heard.

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