Long-term and Short-term Debt

12 Months Ended

Sep. 30, 2021

Debt Disclosure [Abstract]

Long-term and Short-term Debt

Long-term and Short-term Debt

Long-term debt consists of (in millions):

	September 30,
	2021		2020
0.35% notes, payable in August 2023	$	600.0	$	—
2.875% notes, payable in March 2025	315.6		320.1
6.70% debentures, payable in January 2028	250.0		250.0
3.50% notes, payable in March 2029	425.0		425.0
1.75% notes, payable in August 2031	450.0		—
6.25% debentures, payable in December 2037	250.0		250.0
4.20% notes, payable in March 2049	575.0		575.0
2.80% notes, payable in August 2061	450.0		—
5.20% debentures, payable in January 2098	200.0		200.0
Unamortized discount, capitalized lease obligations and other	(51.0)		(45.4)
Long-term debt	$	3,464.6	$	1,974.7

Our short-term debt as of September 30, 2021, includes $484.0 million of commercial paper borrowings with a weighted average interest rate of 0.18 percent. There were no commercial paper borrowings outstanding as of September 30, 2020. Also included in short-term debt as of September 30, 2021, and 2020, are $23.5 million of interest-bearing loans from Schlumberger to Sensia, which were originally due September 30, 2020, and are now due December 31, 2021. The short-term loans from Schlumberger were entered into following formation of Sensia in fiscal 2020.

In August 2021, we issued $1.5 billion aggregate principal amount of long-term notes in a registered public offering. The offering consisted of $600.0 million of 0.35% notes due in August 2023, $450.0 million of 1.75% notes due in August 2031, and $450.0 million of 2.80% notes due in August 2061, all issued at a discount. Net proceeds to the Company from the debt offering were $1,485.6 million. We used these net proceeds primarily to fund the acquisition of Plex. Refer to Note 4 for additional information on this acquisition.

We entered into treasury locks to manage the potential change in interest rates in anticipation of the issuance of the $1.5 billion aggregate notes in August 2021. These treasury locks were designated as and accounted for as cash flow hedges. As a result of the changes in the interest rates on the treasury locks between the time we entered into the treasury locks and the time we priced and issued the notes, the Company made a net payment of $28.0 million to the counterparties. The $28.0 million net loss on the settlement of the treasury locks was recorded in Accumulated Other Comprehensive Loss, net of tax effect, and is being amortized over the term of the corresponding notes, and recognized as an adjustment to interest expense in the Consolidated Statement of Operations.

In April 2020, we entered into a $400.0 million senior unsecured 364-day term loan credit agreement and were advanced the full loan amount. Interest on these borrowings was based on short-term money market rates in effect during the period the borrowings were outstanding. We repaid the $400.0 million term loan in September 2020.

In March 2019, we issued $1 billion aggregate principal amount of long-term notes in a registered public offering. The offering consisted of $425.0 million of 3.50% notes due in March 2029 (“2029 Notes”) and $575.0 million of 4.20% notes due in March 2049 (“2049 Notes”), both issued at a discount. Net proceeds to the Company from the debt offering were $987.6 million. We used these net proceeds primarily to repay our outstanding commercial paper, with the remaining proceeds used for general corporate purposes.

We entered into treasury locks to manage the potential change in interest rates in anticipation of the issuance of $1.0 billion of fixed rate debt in March 2019. Treasury locks are accounted for as cash flow hedges. The effective differentials paid on these treasury locks was initially recorded in Accumulated Other Comprehensive Loss, net of tax effect.

As a result of the changes in the interest rates on the treasury locks between the time we entered into the treasury locks and the time we priced and issued the 2029 Notes and 2049 Notes, the Company made a payment of $35.7 million to the counterparty on March 1, 2019. The $35.7 million loss on the settlement of the treasury locks was recorded in Accumulated Other Comprehensive Loss and is being amortized over the term of the 2029 Notes and 2049 Notes, and recognized as an adjustment to interest expense in the Consolidated Statement of Operations.

On November 13, 2018, we replaced our former five-year $1.0 billion unsecured revolving credit facility with a new five-year $1.25 billion unsecured revolving credit facility expiring in November 2023. We can increase the aggregate amount of this credit facility by up to $750.0 million, subject to the consent of the banks in the credit facility. We did not incur early termination penalties in connection with the termination of the former credit facility. We did not borrow against the facility during the periods ended September 30, 2021 or 2020. Borrowings under the new credit facility bear interest based on short-term money market rates in effect during the period the borrowings are outstanding. This credit facility contains covenants under which we agree to maintain an EBITDA-to-interest ratio of at least 3.0 to 1.0. The EBITDA-to-interest ratio is defined in the credit facility as the ratio of consolidated EBITDA (as defined in the facility) for the preceding four quarters to consolidated interest expense for the same period.

Interest payments were $91.8 million during 2021, $101.7 million during 2020 and $97.5 million during 2019.

The following table presents the carrying amounts and estimated fair values of long-term debt not recorded at fair value in the Consolidated Balance Sheet (in millions):

	September 30, 2021				September 30, 2020
	Carrying Value		Fair Value		Carrying Value		Fair Value
Long-term debt	$	3,464.6	$	3,874.8	$	1,974.7	$	2,497.7

We base the fair value of long-term debt upon quoted market prices for the same or similar issues and therefore consider this a Level 2 fair value measurement. The fair value of long-term debt considers the terms of the debt excluding the impact of derivative and hedging activity. Refer to Note 1 for further information regarding levels in the fair value hierarchy.