New York, NY, United States (4E) – Verizon Communications Inc. sold on Wednesday $49bn worth of bonds, setting a record for corporate bond offering.
The nation’s second-largest telephone carrier issued fixed-rate debt with three- to 30-year maturities, as well as two portions of floating-rate securities, according to Bloomberg News data. Verizon offered a premium for the size of its offering, paying a yield of 47 basis points more than investors expected for its 10-year portion compared with those that have similar maturities and BBB ratings.
The proceeds of the transaction will help finance Verizon’s acquisition of Vodafone Group PLC’s stake in U.S. wireless company Verizon Wireless worth $130bn. The $49bn bond sale easily surpassed the $17bn raised by Apple Inc., the previous record for deal size.
In its regulatory filings, Verizon said the transaction was arranged by Bank of America Corp., Morgan Stanley, Barclays Plc and JPMorgan Chase & Co.
After the completion of the U.S. dollar deal, Citigroup had planned to market potential bonds in Europe including Paris, London, Frankfurt and Edinburgh, but it is putting those efforts on hold, according to sources at the two banks hired to manage the sales meetings.
A source also said that the global demand for the Verizon sale led to total orders top out at around $100bn.