Company: GHC
Filing Date: 2025-02-26
Form Type: 10-K
Source: 0000104889-25-000022
Chunk: 97

Company: Graham Holdings Co
Filing Date: 2025-02-26
Form: 10-K
Item: Item 16
Chunk 97
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 the counterparty a fixed rate of 4.67% per annum. The new interest rate swap agreements were entered into to convert the variable rate borrowing under the real estate term loan into a fixed rate borrowing. Based 

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on the terms of the new interest rate swap agreements and underlying borrowings, the new interest rate swaps were determined to be effective and thus qualify as cash flow hedges. Including a 1.75% applicable margin, the overall interest rate that the Company will pay on the $75.2 million real estate term loan is fixed at 6.42% per annum.The automotive subsidiary used the net proceeds from the real estate and capital term loans to repay the outstanding balances of the commercial notes maturing in 2031 and 2032. The interest rate swap agreements maturing in 2031 and 2032 were also terminated resulting in realized gains of $4.6 million that reduced interest expense during the third quarter of 2023.The fair value of the Company’s other debt, which is based on Level 2 inputs, approximates its carrying value as of December 31, 2024 and 2023. The Company is in compliance with all financial covenants of the revolving credit facility and term loans as of December 31, 2024.During 2024 and 2023, the Company had average borrowings outstanding of approximately $804.7 million and $745.0 million, respectively, at average annual interest rates of approximately 6.3% and 6.1%, respectively. The Company incurred net interest expense of $176.3 million, $56.2 million and $51.2 million during 2024, 2023 and 2022, respectively. For the years ended December 31, 2024, 2023 and 2022, the Company recorded interest expense of $119.3 million, $10.1 million and $16.5 million, respectively, to adjust the fair value of the mandatorily redeemable noncontrolling interest. The fair value of the mandatorily redeemable noncontrolling interest was based on the fair value of the underlying subsidiaries owned by GHC One and GHC Two, after taking into account any debt and other noncontrolling interests of its subsidiary investments. The fair value of the owned subsidiaries is determined by reference to either a discounted cash flow or EBITDA multiple, which approximates fair value (Level 3 fair value assessment).

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12.    FAIR VALUE