Matthew Waterman
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Matthew Waterman in Brand Power,

Mondelez International Is Taking On Some New Debt Too

Ok this one I'm not too thrilled about. Mondelez International (MDLZ), the snack division that was spun off of Kraft, who is now merged into Kraft-Heinz (KHC), and if you really want to keep going further back, was spun off of Altria (MO), who were formally known as Phillip Morris.. and, wait, what was I talking about again?

Right, debt. So Mondelez is selling some bonds. Unlike Microsoft (MSFT), who I previously mentioned as being prudent with their new debt, Mondelez not so much. Their new notes, due in 2018 are going into the market with a 7.75% coupon. That is approaching the kind of yields you get today on junk-rated bonds.

Mondelez got a bit of a raw deal on the separation from Kraft, as they saddled them up with Kraft's long term debt and then kicked them out the door. The bonds are probably a sound enough purchase if you can get them for a good price, but this makes me want to avoid owning the stock for the time being. 

Mondelez closed up 79 cents to $44.06 today. Kraft-Heinz closed up 89 cents to $71.65, Altria up 49 cents to $56.77.