Equifax 2009 Annual Report Download - page 26

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS continued
2008 Acquisitions and Investments. To further enhance our mar- 2007 Acquisitions. On May 15, 2007, we acquired all the out-
ket share and grow our credit data business, during the twelve standing shares of TALX. Under the terms of the transaction, we
months ended December 31, 2008, we completed nine acquisitions issued 20.6 million shares of Equifax treasury stock and 1.9 million
and investments in a number of small businesses totaling $27.4 mil- fully-vested options to purchase Equifax common stock, and paid
lion, net of cash acquired. Six of the transactions were in our Inter- approximately $288.1 million in cash, net of cash acquired. We also
national segment, two within our U.S. Consumer Information Solu- assumed TALX’s outstanding debt, which had a fair value totaling
tions segment and one within our TALX segment. We recorded a $177.6 million at May 15, 2007. We financed the cash portion of
$6.0 million liability at December 31, 2009, with a corresponding the acquisition and $96.6 million outstanding on the TALX revolving
adjustment to goodwill, for the contingent earn-out payment associ- credit facility at the date of acquisition initially with borrowings under
ated with the acquired company within the TALX segment. The our Senior Credit Facility, and subsequently refinanced this debt in
earn-out payment was measured on the completion of 2009 reve- the second quarter of 2007 with ten- and thirty-year notes. Subse-
nue targets and will be paid in 2010. quent to the date of the acquisition in 2007, we paid $4.1 million to
the former owners of a company purchased by TALX pursuant to
an earn-out agreement.
On June 30, 2008, as a part of our long-term growth strategy of
entering new geographies, we acquired a 28 percent equity interest
in Global Payments Credit Services LLC, or GPCS, a credit informa- On October 19, 2007, in order to continue to grow our credit data
tion company in Russia, for cash consideration of $4.4 million, business, our Peruvian subsidiary purchased 100% of the stock of a
which is now doing business as Equifax Credit Services, LLC in credit reporting business located in Peru for cash consideration of
Russia. Under our shareholders’ agreement, we have the option to approximately $8.0 million.
acquire up to an additional 22 percent interest in GPCS between
2011 and 2013 for cash consideration based on a formula for For additional information about our acquisitions, see Note 2 of the
determining equity value of the business and the assumption of Notes to Consolidated Financial Statements in this report.
certain debt, subject to satisfaction of certain conditions.
Financing Activities
Net cash provided by (used in): Twelve Months Ended December 31, Change
(Dollars in millions) 2009 2008 2007 2009 vs. 2008 2008 vs. 2007
Net short-term borrowings (repayments) $101.8 $ (184.8) $ 139.7 $ 286.6 $ (324.5)
Net (repayments) borrowings under long-term revolving
credit facilities $ (415.2) $ 45.0 $ 253.4 $ (460.2) $ (208.4)
Payments on long-term debt $ (31.8) $ (17.8) $ (250.0) $ (14.0) $ 232.2
Proceeds from issuance of long-term debt $ 274.4 $ 2.3 $ 545.7 $ 272.1 $ (543.4)
Credit Facility Availability. Our principal unsecured revolving credit In June 2009, we amended our 364-day revolving credit agreement
facility with a group of banks, which we refer to as the Senior Credit with a Canadian bank (our Canadian Credit Facility), to reduce the
Facility, permits us to borrow up to $850.0 million through July borrowing limit from C$40.0 million to C$20.0 million (denominated
2011. The Senior Credit Facility may be used for general corporate in Canadian dollars) and extending its maturity through June 2010.
purposes. Availability of the Senior Credit Facility for borrowings is Borrowings may be used for general corporate purposes.
reduced by the outstanding face amount of any letters of credit
issued under the facility and, pursuant to our existing Board of At December 31, 2009, there was outstanding $4.8 million under
Directors authorization, by the outstanding principal amount of our the Senior Credit Facility, which is included in long-term debt on our
commercial paper notes, or CP. We currently intend to renew the Consolidated Balance Sheet; $135.0 million in CP; and no amounts
Senior Credit Facility on or prior to its maturity date. Due to current under our Canadian Credit Facility. The weighted-average interest
tight conditions in the credit markets, we expect to face increased rate on our CP, all with maturities less than 90 days, was 0.4% per
borrowing spreads as well as market trends of higher bank fees in annum. At December 31, 2009, a total of $726.7 million was avail-
connection with this renewal. able under our committed credit facilities.
Our $850.0 million CP program has been established to allow for At December 31, 2009, approximately 66% of our debt was
borrowing through the private placement of CP with maturities rang- fixed-rate debt and 34% was effectively variable-rate debt. Our vari-
ing from overnight to 397 days. We may use the proceeds of CP able-rate debt, consisting of CP, borrowings under our credit facili-
for general corporate purposes. ties and our five-year senior notes due 2014 (against which we have
executed interest rate swaps to convert interest expense from fixed
rates to floating rates), generally bears interest based on a specified
24 EQUIFAX 2009 ANNUAL REPORT
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