Friday, April 24, 2015

AT&T Sells Bonds to Finance its Purchase of DirecTV

AT&T bond sale aimed at financing DirecTV acquisition.  AT&T completed a $17.5 billion corporate bond sale to help pay for its DirecTV acquisition.

The offering, which drew mixed reviews on Wall Street, is the second largest this year alone behind a $21 billion offering by Actavis in March. The all-time topper was a $49 billion deal by Verizon in September 2013.

 Investors reportedly jumped at the offering "enticed in part because the new bonds, which will mature in five to 31 years, offered more interest that the company's existing debt," a Wall Street Journal story said.

Friday, April 3, 2015

Bershire Hathaway joins Apple on the European Conga Line with a Bond Offering

The Sage of Omaha is taking a trip across the Atlantic to take advantage of the eye-wateringly low borrowing costs available to highly rated corporate bond issuers in Europe.

According the Financial Times, Warren Buffett's Berkshire Hathaway business, which is not known for borrowing in European bond markets, has hired banks including Deutsche Bank, Goldman Sachs and BofA Merrill Lynch for a potential eurobond offering, according to someone with direct knowledge of the deal. This is part of a trend for US companies to take advantage of huge demand and high prices for euro-denominated bonds that has gathered steam ahead of the European Central Bank launching its bond-buying monetary stimulus this month.

Apple, for example, sold 2.8bn of eurobonds in November. Lending in Europe, where the German ten-year government bond pays less than .5%, allows large U.S. companies to offer interest payments less than in the U.S.