Quarterly report pursuant to Section 13 or 15(d)

DEBT

v3.24.3
DEBT
 9 Months Ended
Sep. 30, 2024
Debt Disclosure [Abstract]  
DEBT
NOTE 9. DEBT
Loans Payable and Commercial Paper
Loans payable, commercial paper and the related weighted-average interest rates were as follows:
In millions September 30,
2024		 December 31,
2023
Loans payable (1)
$ 441  $ 280 
Commercial paper (2)
1,636  1,496 
(1) Loans payable consist primarily of notes payable to various international and domestic financial institutions. It is not practicable to aggregate these notes and calculate a quarterly weighted-average interest rate.
(2) The weighted-average interest rate, inclusive of all brokerage fees, was 5.25 percent and 5.43 percent at September 30, 2024, and December 31, 2023, respectively.
We can issue up to $4.0 billion of unsecured, short-term promissory notes (commercial paper) pursuant to the Board authorized commercial paper programs. These programs facilitate the private placement of unsecured short-term debt through third-party brokers. We intend to use the net proceeds from the commercial paper borrowings for general corporate purposes.
Revolving Credit Facilities
On June 3, 2024, we entered into an amended and restated five-year credit agreement that allows us to borrow up to $2.0 billion of unsecured funds at any time prior to June 3, 2029. The credit agreement amended and restated the prior $2.0 billion five-year credit agreement that would have matured on August 18, 2026.
On June 3, 2024, we entered into an amended and restated 364-day credit agreement that allows us to borrow up to $2.0 billion of unsecured funds at any time prior to June 2, 2025. This credit agreement amended and restated the prior $2.0 billion 364-day credit facility that matured on June 3, 2024.
Our committed credit facilities provide access up to $4.0 billion, including our $2.0 billion 364-day facility that expires June 2, 2025, and our $2.0 billion five-year facility that expires on June 3, 2029. We intend to maintain credit facilities at the current or higher aggregate amounts by renewing or replacing these facilities at or before expiration. These revolving credit facilities are maintained primarily to provide backup liquidity for our commercial paper borrowings and general corporate purposes. There were no outstanding borrowings under these facilities at September 30, 2024, and December 31, 2023. At September 30, 2024, the $1.6 billion of outstanding commercial paper effectively reduced the $4.0 billion of revolving credit capacity to $2.4 billion.
At September 30, 2024, we also had an additional $527 million available for borrowings under our international and other domestic credit facilities.
Long-term Debt
A summary of long-term debt was as follows:
In millions Interest Rate September 30,
2024		 December 31,
2023
Long-term debt    
Hydrogenics promissory notes, due 2024 and 2025 —% $ 160  $ 160 
Term loan, due 2025 (1) (2)
Variable —  1,150 
Senior notes, due 2025 (3)
0.75% 500  500 
Atmus term loan, due 2027 (4)
Variable —  600 
Debentures, due 2027 6.75% 58  58 
Debentures, due 2028 7.125% 250  250 
Senior notes, due 2029 4.90% 500  — 
Senior notes, due 2030 (3)
1.50% 850  850 
Senior notes, due 2034 5.15% 750  — 
Senior notes, due 2043 4.875% 500  500 
Senior notes, due 2050 2.60% 650  650 
Senior notes, due 2054 5.45% 1,000  — 
Debentures, due 2098 (5)
5.65% 165  165 
Other debt 165  94 
Unamortized discount and deferred issuance costs (92) (72)
Fair value adjustments due to hedge on indebtedness (70) (96)
Finance leases 124  111 
Total long-term debt 5,510  4,920 
Less: Current maturities of long-term debt 654  118 
Long-term debt $ 4,856  $ 4,802 
(1) During the first nine months of 2024, we repaid the outstanding balance of the term loan.
(2) In 2023, we entered into a series of interest rate swaps in order to trade a portion of the floating rate debt into fixed rate. See "Interest Rate Risk" in NOTE 13, "DERIVATIVES," for additional information.
(3) In 2021, we entered into a series of interest rate swaps to effectively convert debt from a fixed rate to floating rate. See "Interest Rate Risk" in NOTE 13, "DERIVATIVES," for additional information.
(4) See NOTE 14, "ATMUS INITIAL PUBLIC OFFERING (IPO) AND DIVESTITURE," for additional information.
(5) The effective interest rate is 7.48 percent.
On February 20, 2024, we issued $2.25 billion aggregate principal amount of senior unsecured notes consisting of $500 million aggregate principal amount of 4.90 percent senior unsecured notes due in 2029, $750 million aggregate principal amount of 5.15 percent senior unsecured notes due in 2034 and $1.0 billion aggregate principal amount of 5.45 percent senior unsecured notes due in 2054. We received net proceeds of $2.2 billion. The senior unsecured notes pay interest semi-annually on February 20 and August 20, commencing on August 20, 2024. The indenture governing the senior unsecured notes contains covenants that, among other matters, limit (i) our ability to consolidate or merge into, or sell, assign, convey, lease, transfer or otherwise dispose of all or substantially all of our and our subsidiaries' assets to another person, (ii) our and certain of our subsidiaries' ability to create or assume liens and (iii) our and certain of our subsidiaries' ability to engage in sale and leaseback transactions.
Principal payments required on long-term debt during the next five years are as follows:
In millions 2024 2025 2026 2027 2028
Principal payments $ 60 

$ 661  $ 66  $ 100  $ 290 
Fair Value of Debt
Based on borrowing rates currently available to us for bank loans with similar terms and average maturities, considering our risk premium, the fair values and carrying values of total debt, including current maturities, were as follows:
 
In millions September 30,
2024		 December 31,
2023
Fair value of total debt (1)
$ 7,426  $ 6,375 
Carrying value of total debt 7,587  6,696 
(1) The fair value of debt is derived from Level 2 input measures.