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Coca-Cola Hellenic adds fizz to its debt management

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Coca-Cola Hellenic Bottling Company, Coca-Cola's second biggest bottler, had been buying back its outstanding debt on an ad hoc basis throughout 2003. ?We'd been mopping up bonds that came into the market with spare cash last year as we had been building up a lot of cash and had almost completely repaid commercial paper outstandings,? says John Fulton, group treasurer. But in 2004, the Athens-based company decided to do something bigger: to deal with liabilities that were soon to come due, extend its maturity profile and achieve a lower cost of funds.

The process began with a relatively informal discussion with Credit Suisse First Boston. The priority was to buy back some of its June 2006 5.25% Eurobond, which had e555 million outstanding. Eventually, CCHBC decided to launch a tender for some of this, partly financed through a new bond offer.

?We wanted to reduce the refinancing risk of the 2006 maturity and to prefinance the 2004 Eurobond maturity, so we canvassed opinion on whether we should do an exchange offer or a tender of the 2006 bond ? we chose to do the tender believing we would get a better outcome,? says Fulton.

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