(PCLN) says it plans to sell $875M worth of convertible debt, while adding some of... (PCLN) says it plans to sell $875M worth of convertible debt, while adding some of the proceeds will be used to fund a $200M stock buyback program. The remainder of the proceeds will be use for "general corporate purposes," which could include additional buybacks. (PR)

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Comments (3)
  • Monawen
    , contributor
    Comment (1) | Send Message
    Anyone has common on this?
    6 Mar 2012, 05:32 PM Reply Like
  • viveha76
    , contributor
    Comments (2) | Send Message
    why do they need to sell ($875M), which is more than 4 times of their stock purchase ($200M), when they have lot of cash. I didn't understand the math :-). fishy to me.
    7 Mar 2012, 05:44 PM Reply Like
  • Jeremy Johnson, CFA
    , contributor
    Comments (775) | Send Message
    PCLN makes virtually all its money in foreign jurisdictions. I'm not even sure their U.S. operations actually generate cash, although they are net income positive.


    They do have $1 billion of U.S. cash, but it likely is not growing at all and they may have some strategic plans. Also, convertible money is absurdly cheap right now and they may be pre-funding their 2015 note to some degree, although it seems quite early to do this.
    12 Mar 2012, 03:23 PM Reply Like
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