Qurate Retail, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Long-Term Debt

Long-Term Debt

9 Months Ended

Sep. 30, 2011

Long-term Debt, Unclassified [Abstract]

Debt is summarized as follows:



		Outstanding principal September 30, 2011		Carrying value
		Outstanding principal September 30, 2011		September 30, 2011			December 31, 2010

Senior notes and debentures
	5.7% Senior Notes due 2013	309		308			323
	8.5% Senior Debentures due 2029	287		284			284
	8.25% Senior Debentures due 2030	504		501			501
Exchangeable Senior Debentures
	3.125% Exchangeable Senior Debentures due 2023	1,138		1,236			1,283
	4% Exchangeable Senior Debentures due 2029	469		279			265
	3.75% Exchangeable Senior Debentures due 2030	460		254			253
	3.5% Exchangeable Senior Debentures due 2031	486		328			329
	3.25% Exchangeable Senior Debentures due 2031	414		329			376
QVC 7.125% Senior Secured Notes due 2017		500		500			500
QVC 7.5% Senior Secured Notes due 2019		1,000		986			985
QVC 7.375% Senior Secured Notes due 2020		500		500			500
QVC Bank Credit Facilities		459		459			785
Other subsidiary debt		85		85			79
	Total consolidated Liberty debt	$	6,611	6,049			6,463
	Less current maturities			(1,211		)	(493	)
	Total long-term debt			$	4,838		5,970

QVC Bank Credit Facilities

The QVC Bank Credit Facilities provide for a $2 billion revolving credit facility, with a $250 million sub-limit for standby letters of credit. Availability under the QVC Bank Credit Facilities at September 30, 2011 was $1.5 billion. The $459 million outstanding principal matures in September 2015.

QVC was in compliance with all of its debt covenants at September 30, 2011.

QVC Interest Rate Swap Arrangements

During the third quarter of 2009, QVC entered into seven forward interest rate swap arrangements with an aggregate notional amount of $1.75 billion. Such arrangements provide for payments beginning in March 2011 and extending to March 2013. QVC will make fixed payments at rates ranging from 2.98% to 3.67% and receive variable payments at 3 month LIBOR (0.35% at September 30, 2011). Additionally, during the six months ended June 30, 2011 QVC entered into four additional swap arrangements with an aggregate notional amount of $600 million requiring QVC to make variable payments at 3 month LIBOR (0.35% at September 30, 2011) and receive fixed payments at 0.91%. These swap arrangements do not qualify as cash flow hedges under GAAP. Accordingly, changes in the fair value of the swaps are reflected in realized and unrealized gains or losses on financial instruments in the accompanying condensed consolidated statements of operations.

Other Subsidiary Debt

Other subsidiary debt at September 30, 2011 is comprised of capitalized satellite transponder lease obligations and bank debt of certain subsidiaries.

Fair Value of Debt

Liberty estimates the fair value of its debt based on the quoted market prices for the same or similar issues or on the current rate offered to Liberty for debt of the same remaining maturities. The fair value of Liberty's publicly traded debt securities that are not reported at fair value in the accompanying condensed consolidated balance sheet at September 30, 2011 is as follows (amounts in millions):




Senior notes	$	326
Senior debentures	$	774
QVC senior secured notes	$	2,164

Due to the variable rate nature, Liberty believes that the carrying amount of its subsidiary debt not discussed above approximated fair value at September 30, 2011.