Debt and Interest Costs

12 Months Ended

Dec. 31, 2021

Debt

Debt

15. Debt and Interest Costs

Long-term debt and interest rates in effect consisted of the following:

	December 31,
($ in millions)	2021		2020
Senior Notes
5.00% due March 2022	$	—	$	748
4.00% due November 2023		1,000		1,000
4.375%, euro denominated, due December 2023		796		855
0.875%, euro denominated, due March 2024		853		916
5.25% due July 2025		1,000		1,000
4.875% due March 2026		750		750
1.50%, euro denominated, due March 2027		625		672
2.875% due August 2030		1,300		1,300
3.125% due September 2031		850		—
Senior Credit Facility (at variable rates)
Term A loan due March 2024 (1.35% - 2021; 1.40% - 2020)		593		593
Finance lease obligations		14		12
Other (including debt issuance costs)		(56)		(60)
		7,725		7,786
Less: Current portion		(3)		(3)
	$	7,722	$	7,783

The company’s senior credit facilities include long-term multi-currency revolving facilities that mature in March 2024 and provide the company with up to the U.S. dollar equivalent of $1.75 billion. At December 31, 2021, taking into account outstanding letters of credit, $1.7 billion was available under these revolving credit facilities. In addition to these facilities, the company had $1 billion of short-term uncommitted credit facilities available at December 31, 2021, of which $12 million was outstanding and due on demand. At December 31, 2020, the company had $14 million outstanding under short-term uncommitted credit facilities. The weighted average interest rate of the outstanding short-term facilities was 4.92 percent at December 31, 2021, and 5.45 percent at December 31, 2020.

During 2021, Ball issued $850 million of 3.125% senior notes due in 2031 and redeemed the outstanding 5% senior notes due in March 2022 in the amount of $748 million.

The fair value of Ball’s long-term debt was estimated to be $8 billion and $8.3 billion at December 31, 2021 and 2020, respectively, compared to its carrying value of $7.7 billion and $7.8 billion in 2021 and 2020, respectively. The fair value reflects the market rates at each period end for debt with credit ratings similar to the company’s ratings and is classified as Level 2 within the fair value hierarchy. Rates currently available to the company for loans with similar terms and maturities are used to estimate the fair value of long-term debt, based on discounted cash flows.

Long-term debt obligations outstanding at December 31, 2021, have maturities (excluding unamortized debt issuance costs of $62 million) of $3 million, $1.8 billion, $1.4 billion, $1 billion and $750 million in the years ending 2022 through 2026, respectively, and $2.8 billion thereafter.

Letters of credit outstanding at December 31, 2021 and 2020, were $62 million and $43 million, respectively.

Interest payments were $306 million, $332 million and $331 million in 2021, 2020 and 2019, respectively. In 2020, new guidance was issued related to global reference rates reform. Ball is evaluating the impact transitioning its LIBOR-based interest rate loan agreements to SOFR-based interest rate agreements will have on its consolidated financial statements. Based on the company’s most current understanding, the LIBOR to SOFR transition is not expected to have a material impact on its financial condition, results of operations or cash flows.

The company’s senior notes and senior credit facilities are guaranteed on a full, unconditional and joint and several basis by certain of its material subsidiaries. Each of the guarantor subsidiaries is 100 percent owned by Ball Corporation. These guarantees are required in support of these notes and credit facilities, are coterminous with the terms of the respective note indentures and would require performance upon certain events of default referenced in the respective guarantees. Note 23 provides further details about the company’s debt guarantees of the company’s senior notes and the subsidiaries that guarantee the notes (the obligor group).

Ball was in compliance with all loan agreements as of December 31, 2021, and for all prior years presented. The company has also met all debt payment obligations. The U.S. note agreements and bank credit agreement contain certain restrictions relating to dividends, investments, financial ratios, guarantees and the incurrence of additional indebtedness. The most restrictive of the company’s debt covenants requires it to maintain a leverage ratio (as defined) of no greater than 5.0 times, which will change to 4.5 times as of December 31, 2022. As of December 31, 2021, the company could borrow up to the limits available under its long-term multi-currency committed revolving facilities and short-term uncommitted credit facilities without violating any existing debt covenants.