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Corrections Corporation of America Message Board

  • dy2 dy2 Mar 9, 2005 11:49 AM Flag

    Nice free cash flow increase

    CXW is redeeming $250 million debt with an interest rate of 9.876% and replacing it with longer term debt with an interest rate of 6.25%. This looks to me like an annual savings of 3.635% on $250 million, or about $9 million per year, before tax. They're also using $100 million to prepay other loans, which I believe have restrictive covenants that result in less flexibility than CXW would ordinarily have.

    Looks to me that management is really on the ball. This isn't pocket change.


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