Note G: Net debt

Analysis of net debt by category

In € millions, at December 31

2020

2021

Bonds issued

2,486

1,740

Debt from subsidiaries*

5,029

4,485

Long-term borrowings

7,515

6,225

Current portion of long-term borrowings

749

Debt to credit institutions

672

Short-term loans

3

4

Short-term borrowings

3

1,425

Total borrowings

7,518

7,650

Short-term investments

(245)

Cash and cash equivalents

(736)

(404)

Net debt

6,537

7,246

*

Part of the debt from subsidiairies has no fixed repayment schedule. The fair value of the debt from subsidiaries approximates the book value.

Bonds issued

In € millions, at December 31

2020

2021

2 5/8% 2012/22 (€750 million)

748

1 3/4% 2014/24 (€500 million)

498

499

1 1/8% 2016/26 (€500 million)

497

497

1 5/8% 2020/30 (€750 million)

743

744

Total

2,486

1,740

Long-term borrowings

The part of long-term borrowings that is due within one year is presented under short-term borrowings. Short-term borrowings include the €750 million bond maturing in 2022.

For the fair value of the bonds issued, refer to Note 27 of the Consolidated financial statements. We estimated the fair value of the bonds issued based on the quoted market prices (level 1) for the same or similar issues or on the current rates offered to us for debt with similar maturities. At year-end 2021, the fair value of the bonds included in long-term and short-term borrowings was €2,624 million (2020: €2,710 million).

We have a multi-currency revolving credit facility of €1.3 billion which was extended in 2021 to 2026. This facility does not contain financial covenants or acceleration provisions that are based on adverse changes in ratings or material adverse change. At year-end 2021 and 2020, this facility has not been drawn.

At year-end 2021 and 2020, none of the borrowings was secured by collateral.

In 2022, an amount of €216 million of debt from subsidiaries will mature and and amount of €1 million of debt from subsidiaries will mature after 2026. The remainder of the loans to subsidiaries has no fixed repayment schedule.

Short-term borrowings

In July 2022, a bond of €750 million will mature. This bond is classified as a short-term borrowing. We have US dollar and euro commercial paper programs in place, which can be used to the extent that the equivalent portion of the €1.3 billion multi-currency revolving credit facility is not used. We had €371 million commercial paper outstanding at year-end 2021 (2020: €nil) against an average negative interest rate of 0.5%. At year-end 2021, we had a €300 million short-term bank loan outstanding (2020: €nil) against a negative interest rate of 0.6%. Neither of these facilities contains financial convenants.

Short-term investments

Short-term investments almost entirely consist of time deposits, money market funds and marketable securities with a life time at investment date longer than three months but shorter than twelve months. At year-end 2021, we had no short-term investments outstanding (2020: €245 million).

Cash and cash equivalents

Deposits and money market funds within cash and cash equivalents almost entirely consist of time deposits immediately convertible into known amounts of cash and with a maturity of three months or less from the date of purchase and marketable securities that can be redeemed immediately when called.

Cash and cash equivalents

In € millions, at December 31

2020

2021

Cash on hand and in banks

427

304

Deposits and money markets funds with a maturity less than three months

309

100

Included in cash and cash equivalents in the balance sheet

736

404