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Debt and Other Financing Arrangements
 12 Months Ended
Dec. 31, 2021
Debt Disclosure [Abstract]  
Debt and Other Financing Arrangements [Text Block]
Note 10.    Debt and Other Financing Arrangements
Effective interest rate at December 31,December 31,December 31,
(Dollars in millions)202120212020
Commercial Paper0.01 %$2,522 $— 
2.15% 7-Year Senior Notes, Due 7/21/2022 (euro-denominated)
— 611 
3.00% 7-Year Senior Notes, Due 4/15/2023
— 1,000 
Floating Rate (SOFR + 0.35%) 1.5-Year Senior Notes, Due 4/18/2023
1,000 — 
Floating Rate (SOFR + 0.39%) 2-Year Senior Notes, Due 10/18/2023
500 — 
0.797% 2-Year Senior Notes, Due 10/18/2023
1.03 %1,350 — 
Floating Rate (EURIBOR + 0.20%) 2-Year Senior Notes Due 11/18/2023 (euro-denominated)
0.00 %1,933 — 
0.000% 2-Year Senior Notes Due 11/18/2023 (euro-denominated)
0.06 %625 — 
4.15% 10-Year Senior Notes, Due 2/1/2024
— 1,000 
0.75% 8-Year Senior Notes, Due 9/12/2024 (euro-denominated)
0.94 %1,137 1,222 
1.215% 3-Year Senior Notes, Due 10/18/2024
1.42 %2,500 — 
Floating Rate (SOFR + 0.53%) 3-Year Senior Notes, Due 10/18/2024
500 — 
0.125% 5.5-Year Senior Notes, Due 3/1/2025 (euro-denominated)
0.41 %910 977 
4.133% 5-Year Senior Notes, Due 3/25/2025
— 1,100 
2.00% 10-Year Senior Notes, Due 4/15/2025 (euro-denominated)
2.10 %728 782 
0.000% 4-Year Senior Notes Due 11/18/2025 (euro-denominated)
0.16 %625 — 
3.65% 10-Year Senior Notes, Due 12/15/2025
3.77 %350 350 
1.40% 8.5-Year Senior Notes, Due 1/23/2026 (euro-denominated)
1.53 %796 855 
2.95% 10-Year Senior Notes, Due 9/19/2026
— 1,200 
Effective interest rate at December 31,December 31,December 31,
(Dollars in millions)202120212020
1.45% 10-Year Senior Notes, Due 3/16/2027 (euro-denominated)
1.66 %568 611 
1.75% 7-Year Senior Notes, Due 4/15/2027 (euro-denominated)
1.97 %682 733 
3.20% 10-Year Senior Notes, Due 8/15/2027
— 750 
0.50% 8.5-Year Senior Notes, Due 3/1/2028 (euro-denominated)
0.77 %910 977 
1.375% 12-Year Senior Notes, Due 9/12/2028 (euro-denominated)
1.46 %682 733 
1.750% 7-Year Senior Notes, Due 10/15/2028
1.89 %700 — 
1.95% 12-Year Senior Notes, Due 7/24/2029 (euro-denominated)
2.08 %796 855 
2.60% 10-Year Senior Notes, Due 10/1/2029
2.74 %900 900 
4.497% 10-Year Senior Notes, Due 3/25/2030
— 1,100 
0.80% 9-Year Senior Notes, Due 10/18/2030 (euro-denominated)
0.89 %1,990 — 
0.875% 12-Year Senior Notes, Due 10/1/2031 (euro-denominated)
1.13 %1,023 1,099 
2.00% 10-Year Senior Notes, Due 10/15/2031
2.23 %1,200 — 
2.375% 12-Year Senior Notes, Due 4/15/2032 (euro-denominated)
2.55 %682 733 
1.125% 12-Year Senior Notes, Due 10/18/2033 (euro-denominated)
1.21 %1,706 — 
2.875% 20-Year Senior Notes, Due 7/24/2037 (euro-denominated)
2.94 %796 855 
1.50% 20-Year Senior Notes, Due 10/1/2039 (euro-denominated)
1.73 %1,023 1,099 
2.80% 20-Year Senior Notes, Due 10/15/2041
2.90 %1,200 — 
1.625% 20-Year Senior Notes, Due 10/18/2041 (euro-denominated)
1.78 %1,421 — 
5.30% 30-Year Senior Notes, Due 2/1/2044
5.37 %400 400 
4.10% 30-Year Senior Notes, Due 8/15/2047
4.23 %750 750 
1.875% 30-Year Senior Notes, Due 10/1/2049 (euro-denominated)
1.98 %1,137 1,222 
2.00% 30-Year Senior Notes, Due 10/18/2051 (euro-denominated)
2.07 %853 — 
Other 76 5 
Total borrowings at par value
34,971 21,919 
Fair value hedge accounting adjustments
— 25 
Unamortized discount
(117)(102)
Unamortized debt issuance costs
(184)(114)
Total borrowings at carrying value
34,670 21,728 
Finance lease liabilities
200 7 
Less: Short-term obligations and current maturities
2,537 2,628 
Long-term obligations$32,333 $19,107 
SOFR - Secured Overnight Financing Rate
EURIBOR - Euro Interbank Offered Rate
The effective interest rates for the fixed-rate debt include the stated interest on the notes, the accretion of any discount and the amortization of any debt issuance costs.
See Note 14 for fair value information pertaining to the company’s long-term borrowings.
As of December 31, 2021, the annual repayment requirements for debt obligations are as follows:
(In millions)BorrowingsFinance Lease Liabilities
2022 $2,522 $15 
2023 5,396 12 
2024 4,138 12 
2025 2,610 12 
2026 797 12 
2027 and thereafter19,508 137 
$34,971 $200 
In addition to available borrowings under the company’s revolving credit agreements, discussed below, the company had unused lines of credit of $78 million as of December 31, 2021. These unused lines of credit generally provide for short-term unsecured borrowings at various interest rates.
Credit Facilities
On January 7, 2022, the company entered into a new revolving credit facility (the Facility) with a bank group that provides for up to $5.00 billion of unsecured multi-currency revolving credit The Facility replaces the company’s $3.00 billion credit facility which was in place at December 31, 2021 (the prior credit facility). The Facility expires on January 7, 2027. The revolving credit agreement calls for interest at either a Term SOFR, a EURIBOR-based rate (for funds drawn in euro) or a rate based on the prime lending rate of the agent bank, at the company’s option. The agreement contains affirmative, negative and financial covenants, and events of default customary for facilities of this type. The covenants in the Facility include a Consolidated Net Interest Coverage Ratio (Consolidated EBITDA to Consolidated Net Interest Expense), as such terms are defined in the Facility. Specifically, the company has agreed that, so long as any lender has any commitment under the Facility, any letter of credit is outstanding under the Facility, or any loan or other obligation is outstanding under the Facility, it will maintain a minimum Consolidated Interest Coverage Ratio of 3.5:1.0 as of the last day of any fiscal quarter. As of December 31, 2021, no borrowings were outstanding under the prior credit facility, although available capacity was reduced by approximately $4 million as a result of outstanding letters of credit.
Commercial Paper Programs
The company has commercial paper programs pursuant to which it may issue and sell unsecured, short-term promissory notes (CP Notes). Under the U.S. program, a) maturities may not exceed 397 days from the date of issue and b) the CP Notes are issued on a private placement basis under customary terms in the commercial paper market and are not redeemable prior to maturity nor subject to voluntary prepayment. Under the euro program, maturities may not exceed 183 days and may be denominated in euro, U.S. dollars, Japanese yen, British pounds sterling, Swiss franc, Canadian dollars or other currencies. Under both programs, the CP Notes are issued at a discount from par (or premium to par, in the case of negative interest rates), or, alternatively, are sold at par and bear varying interest rates on a fixed or floating basis. As of December 31, 2021, there were $2.52 billion outstanding borrowings under these programs.
Senior Notes
Interest is payable quarterly on the floating rate senior notes, annually on the euro-denominated fixed rate senior notes and semi-annually on all other senior notes. Each of the fixed rate senior notes may be redeemed at a redemption price of 100% of the principal amount plus a specified make-whole premium and accrued interest. Except for the euro-denominated floating rate senior notes, which may not be redeemed early, the floating rate senior notes may be redeemed in whole or in part on or after their applicable call dates at a redemption price of 100% of the principal amount plus accrued interest. The company is subject to certain affirmative and negative covenants under the indentures governing the senior notes, the most restrictive of which limits the ability of the company to pledge principal properties as security under borrowing arrangements. The company was in compliance with all covenants at December 31, 2021.
The company intends to allocate an amount equal to the net proceeds from the 0.000% senior notes due 2025 to finance or refinance, in whole or in part, certain green or social eligible projects. Pending allocation to green or social eligible projects, such net proceeds may be temporarily invested in cash, cash equivalents, short-term investments, or used to repay other borrowings.
In 2021, the company redeemed some of its existing senior notes. In connection with these redemptions, the company incurred $767 million of losses on the early extinguishment of debt included in other income/(expense) on the accompanying
statement of income. Upon redemption of the senior notes, the company terminated the related fixed to floating rate interest rate swap arrangements and received $22 million, included in other financing activities, net, in the accompanying statement of cash flows.
In 2019, the company refinanced certain of its debt by issuing new senior notes and using the proceeds to redeem some of its existing senior notes. In connection with these redemptions, the company incurred $184 million of losses on the early extinguishment of debt included in other income/(expense) on the accompanying statement of income. Upon redemption of the senior notes, the company terminated the related fixed to floating rate interest rate swap arrangements and paid $17 million, included in other financing activities, net, in the accompanying statement of cash flows. The company also terminated related cross-currency interest rate swap arrangements and received $44 million, included in other investing activities, net, in the accompanying statement of cash flows.
In February 2022, the company redeemed all of its 3.650% Senior Notes due 2025. In connection with the redemption the company incurred approximately $26 million of losses on the early extinguishment of debt in the first quarter of 2022.
Thermo Fisher Scientific (Finance I) B.V. (Thermo Fisher International), a wholly-owned finance subsidiary of the company, issued each of the Floating Rate Senior Notes due 2023, the 0.00% Senior Notes due 2023, the 0.00% Senior Notes due 2025, the 0.80% Senior Notes due 2030, the 1.125% Senior Notes due 2033, the 1.625% Senior Notes due 2041, and the 2.00% Senior Notes due 2051 included in the table above (collectively, the “Euronotes”) in registered public offerings. The company has fully and unconditionally guaranteed all of Thermo Fisher International’s obligations under the Euronotes and all of Thermo Fisher International’s other debt securities, and no other subsidiary of the company will guarantee these obligations. Thermo Fisher International is a “finance subsidiary” as defined in Rule 13-01(a)(4)(vi) of the Exchange Act, with no assets or operations other than those related to the issuance, administration and repayment of the Euronotes and other debt securities issued by Thermo Fisher International from time to time. The financial condition, results of operations and cash flows of Thermo Fisher International are consolidated in the financial statements of the company.