Tech Data 2013 Annual Report Download - page 68

Table of Contents
establishing a presence in Benelux and Romania, extending the Company's product portfolio to include the Autodesk, Inc. software for the
manufacturing industry in Italy, France, UK and Poland and adding a number of highly skilled and qualified professionals, while leveraging the
Company's existing logistics infrastructure in Europe.
Proforma Financial Information
Proforma information for the Company’s acquisitions during fiscal 2012 has not been presented as these acquisitions were not material, either
individually or in the aggregate, to the Company’s consolidated financial position or results of operations.
NOTE 7 — LOSS ON DISPOSAL OF SUBSIDIARIES
In the fourth quarter of fiscal 2012, as part of the Company’s ongoing initiatives to optimize its profitability and return on invested capital, the
decision was made to close the Company’s in-country commercial operations in Brazil and Colombia by the end of fiscal 2012. During the fourth
quarter of fiscal 2012, the Company recorded a loss on disposal of these subsidiaries of $28.3 million , which included a $9.9 million
impairment on
the Company’s investments in Brazil and Colombia due to a foreign currency exchange loss (previously recorded in shareholders’ equity as
accumulated other comprehensive income), $15.3 million related to the write-off of certain value added tax receivables and $3.1 million comprised
primarily of severance costs, fixed asset write-offs and lease termination penalties. These costs are reflected in the Consolidated Statement of
Operations as “loss on disposal of subsidiaries,” which is a component of operating income. These costs do not include any estimated costs
associated with the Brazilian subsidiary’s contingencies for certain tax-related exposures (see further discussion in Note 14 - Commitments and
Contingencies). The operating losses of Brazil and Colombia for the fiscal year ended January 31, 2012 were not material to the Company’s
consolidated operating results.
NOTE 8— DEBT
The carrying value of the Company's outstanding debt consists of the following:
Senior Notes
In September 2012 , the Company issued $350.0 million aggregate principal amount of 3.75% Senior Notes in a public offering, resulting in cash
proceeds of approximately $345.8 million , net of debt discount and debt issuance costs of approximately $1.3 million and $2.9 million ,
respectively (the “Senior Notes”). The debt issuance costs incurred in connection with the public offering will be amortized over the life of the
Senior Notes as additional interest expense using the effective interest method. The Company pays interest on the Senior Notes semi-annually in
arrears on March 21 and September 21 of each year, beginning on March 21, 2013 and ending on the maturity date of September 21, 2017. The
Company, at its option, may redeem the Senior Notes at any time in whole or from time to time in part, at a redemption price equal to the greater of
(i) 100% of the principal amount of the Senior Notes to be redeemed or (ii) the sum of the present values of the remaining scheduled payments of
principal and interest on the Senior Notes being redeemed, discounted at a rate equal to the sum of the applicable Treasury Rate plus 50 basis
points, plus accrued and unpaid interest up to the date of redemption. The Senior Notes are senior, unsecured obligations and rank equally in right
of payment with all of the Company’s other unsecured and unsubordinated indebtedness.
63
January 31,
2013 2012
(In thousands)
Senior notes, interest at 3.75% payable semi-annually, due September 21, 2017
$
350,000
$
0
Less—unamortized debt discount
(1,238
)
0
Senior notes, net
348,762
0
Capital leases
6,243
6,512
Loan payable to Brightstar Corp.
0
14,940
Interest-free revolving credit loan payable to Brightstar Corp.
0
36,306
Other committed and uncommitted revolving credit facilities, average interest rate of 2.09% and 7.15% at
January 31, 2013 and January 31, 2012, respectively, expiring on various dates through fiscal 2017
166,975
47,985
521,980
105,743
Less—current maturities (included as “Revolving credit loans and current portion of long-term debt, net”) (
167,522
)
(48,490
)
Total long-term debt
$
354,458
$
57,253