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.
