Euronet Worldwide Inc.'s Proposed Senior Unsecured Convertible Debt Rated 'BBB-'


NEW YORK (S&P Global Ratings) March 12, 2019--S&P Global Ratings today 
assigned its 'BBB-' debt issue rating on Euronet Worldwide Inc.'s (EEFT) 
proposed $500 million senior unsecured convertible notes due March 15, 2049. 
Euronet disclosed that it may use the proceeds to repurchase up to $100 
million of stock and intends to apply the remainder of the proceeds for 
general corporate purposes which may include redeeming its existing $401.5 
million 1.5% senior unsecured convertible notes due Oct. 1, 2044. The new 
notes are expected to have terms similar to the existing notes, but with a 
higher conversion strike price because Euronet is trading well above the 
$72.18 per share strike price on the existing notes. The holders of the new 
convertible notes will have the option to convert the notes in March 2025 (or 
earlier if certain market conditions are met).

As of December 2018, Euronet had slightly more than $910 million in gross debt 
from which we deduct $200 million of cash to arrive at our adjusted debt 
balance of $710 million. With $560 million in adjusted EBITDA, debt to EBITDA 
fell to 1.3x at the end of 2018 from 2.0x at June 30, 2018, largely because 
the company repaid $300 million outstanding on its short-term ATM facility in 
the second half of the year. 

Our current positive outlook on Euronet reflects our view that that we may 
raise the ratings over the next 18-24 months if the company maintains debt to 
EBITDA below 2.0x on a sustained basis while maintaining strong financial 
performance across its three reportable segments. However, we believe that 
leverage could stabilize between 2.0x and 3.0x if the company were to pursue a 
debt-financed acquisition of either MoneyGram or another large complementary 
business. 
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