You take a debt when needed but in KAR case it wasn't needed and...

You take a debt when needed but in KAR case it wasn't needed and they could have manage to pay off their previous debt without any issue using the revenue they generate and could have obtained debt at lower rate if needed next calendar year !

so 10.5% of 350m USD is roughly $36.75m cash going out of the bank without any reason and that fund could have been used to buy back and they would have announced $60m USD buy back instead of $61.75m USD buyback. Doing this they would have provided more then double return to investor in the form of buy-back !!

They could have even paid that $36.75m USD in dividend equates to 4.6c USD per share roughly and that would have increase current dividend forecast of 7c to 11.6c USD or 17.5c AUD per share which would be close to 9.5% return to shareholder without franking so any franking on top of it will be bonus.

But they decided to show a smiley .. to those looking for dividend or buyback !

So while debt is good, it is not good if you just take it in case you need it next year or in case US going through election and no one else in the world will give them debt so let's start paying some insto 10.5% interest now even though we don't have immediately have need for the debt !