Cardtronics Prices $250M Senior Notes in Private Offering


Cardtronics Inc. (CATM) has priced $250 million senior notes due 2020. The notes will carry an interest of 5.125%.

Cardtronics intends to use the net proceeds from the offering to buy back its 8.250% $1.79 billion senior subordinate notes due 2018 and for general corporate purposes.

At the end of first-quarter 2014, the company had a total debt of $485 million. improving 1.23% over 2013 end level. The debt to capital ratio also showed marginal improvement to 0.65%. Earlier, in Nov 2013 issued $250 million convertible senior notes due on 2020. However, with the new issuance, the debt level will increase along with debt capital ratio showing deterioration in the leverage ratio.

Cardtronics’ interest expense increased 6.5% year over year in the last reported quarter. Nonetheless, it is a prudent approach by the company to issue notes at lower coupon rate taking the advantage of low interest rate environment and buyback debts of higher coupon, thereby lowering its interest burden. The company’s solid operational performance will support it to service debt uninterruptedly, thereby retaining credit worthiness.

Cardtronics carries Zacks Rank #3 (Hold). Better-ranked business service providers that are worth considering include ExamWorks Group, Inc. (EXAM), Iron Mountain Inc. (IRM) and InnerWorkings Inc. (INWK). While ExamWorks sports a Zacks Rank #1 (Strong Buy), Iron Mountain and InnerWorkings carry a Zacks Rank #2 (Buy).

Read the Full Research Report on IRM
Read the Full Research Report on CATM
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