Boston Scientific (NYSE:BSX) announced in an 8-K filing with the SEC yesterday that it had refinanced its junk-level debt in a move that could help it emerge from the nearly $9 billion debt hole created by its acquisition of Guidant Corp. last year. Shareholders are hoping that restructuring move could help the company resolve its debt worries and jump its share price.

The company revealed that it used nearly $1 billion of its own cash reserves to pay down debt that was due next Spring. Shareholders expressed concerns in the past that the company may not be able to meet these obligations and now have increased confidence in the company. The S&P said it would review the company's efforts within a month to see if they qualify for a ratings change.

Boston Scientific also announced last year that it would explore a variety of different ways to unlock value for shareholders and pay down its debt, including a sale of one of its business units. One other idea floated was a spin-off of one of the company's businesses, but these ideas were ultimately shot down by management.

In the end, the refinancing should provide the company with greater financial flexibility, but the fact that they had to tap into their line of credit may limit future opportunities. Relief from this debt could finally help the company emerge from its current lull. Combined, these factors make BSX a stock worth watching.

Related Companies
Johnson & Johnson (JNJ)
Medtronic inc. (MDT)
eV3 Inc. (EVVV)