Shares of consumer packaged goods company B&G Foods (NYSE: BGS) dropped on Wednesday after the company announced details regarding its planned debt offering Tuesday night. As of 12:15 p.m. ET, B&G Foods stock was down about 5%, which is a big move for this ordinarily sleepy stock.

As of the second quarter of 2023, B&G Foods had a substantial debt load of over $2.2 billion. Of this, $875.6 million is due in 2025. But management is already planning ahead. In today's press release, the company said that it's planning to raise $550 million (almost $539 million net of expenses) via senior secured notes. The proceeds will go to paying down the debt due in 2025.

B&G Foods' new notes are due in 2028. However, the market likely isn't thrilled with the details. The 2025 notes had a 5.25% interest rate. The new notes have an 8% interest rate. In short, servicing the debt is getting more expensive.

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Source Fool.com