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SCHERING-PLOUGH SHIFTS DEBT; ADOPTS NEW INCOME TAX ACCOUNTING STANDARD

 SCHERING-PLOUGH SHIFTS DEBT;
 ADOPTS NEW INCOME TAX ACCOUNTING STANDARD
 MADISON, N.J., April 9 /PRNewswire/ -- To take advantage of favorable interest rates, Schering-Plough Corporation (NYSE: SGP) announced today that its board of directors has authorized an "in-substance defeasance" of the company's zero coupon notes issued as part of its 1991 LYNX transaction. The company has purchased approximately $600 million in U.S. government obligations and deposited them into a trust account. When the zero coupon notes mature on Dec. 2, 1996, at a value of $828.6 million, the value of the securities in the trust will have increased to an equivalent amount. This action enables the debt to be removed from the company's balance sheet effective March 31, 1992.
 Commenting on the transaction, Harold R. Hiser, Jr., executive vice president-finance, stated, "The current steep interest rate yield curve presented Schering-Plough with an opportunity to further enhance the benefits of the LYNX transaction." Since the government obligations were purchased with short term funds, the net result is that the cost of the zero coupon debt is replaced with lower short term-costs.
 The company also announced that it will adopt financial accounting standard number 109, "Accounting for Income Taxes," in the first quarter of 1992. The adoption of this standard will result in a modest, one- time gain. The gain recognized from changing to the new accounting standard is substantially offset by charges associated with the in-substance debt defeasance. From an accounting standpoint, both items will be reported in a manner similar to "extraordinary items" in the company's first quarter income statement. Earnings for the first quarter will not be affected by these two events.
 Robert P. Luciano, chairman and chief executive officer, reiterated the company's projection that 1992 earnings per share will be 18 to 20 percent over 1991.
 Schering-Plough Corporation is a research-based company engaged in the discovery, development, manufacturing and marketing of pharmaceutical and health care products worldwide.
 -0- 4/9/92
 /CONTACT: Steve Galpin, Jr., 201-822-7415, for Schering-Plough/
 (SGP) CO: Schering-Plough Corporation ST: New Jersey IN: MTC SU:


TQ -- NY027 -- 6665 04/09/92 10:14 EDT
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Publication:PR Newswire
Date:Apr 9, 1992
Words:350
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