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Zero-coupon exchangeable structures carry a specific rate cycle logic: the issuer sheds coupon expense entirely, while holders absorb equity optionality in exchange for that yield sacrifice.
(NYSE: PBF) put that logic to work on September 17, 2026, when its subsidiary PBF Holding Company LLC, together with co-issuer PBF Finance Corporation, issued $550 million in aggregate principal amount of 0% Exchangeable Senior Notes due 2032, generating net proceeds of approximately $533.6 million after fees.
Proceeds are designated for capped call transaction costs, the full redemption of the company's outstanding 7.875% senior unsecured notes due 2030, and general corporate purposes.
The coupon step-down from 7.875% to zero represents a material reduction in cash interest expense at the PBF Holding level, though the complete cost calculation folds in the expense of the capped call overlay.
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