UPDATE 1-WalMart launches $5 bln four-part bond issue
By John Balassi
NEW YORK, April 4 (IFR) - WalMart Stores on Thursday launched a $5 billion four-part bond issue with a similar structure to a deal the company did in 2011.
The world's biggest retailer is planning to sell $1 billion of three-year notes at Treasuries plus 30 basis points, $1.25 billion of five-year notes at Treasuries plus 45bp, $1.75 billion of 10-year notes at Treasuries plus 82bp and $1 billion of 30-year notes at plus 102bp. The shorter tranches were slightly tighter than initial price thoughts.
Proceeds of the deal, led by active joint books Barclays, Citigroup and Morgan Stanley, will be used for general corporate purposes.
WalMart, rated Aa2/AA/AA, last came to the dollar market on April 11, 2011 with a $5 billion four-part offering.
That deal consisted of a $1 billion 1.625% three-year at plus 40bp, a $1 billion 2.8% five-year at plus 57bp, a $1 billion 4.25% 10-year at plus 75bp, and a $2 billion 5.625% 30-year at plus 110bp.
Despite a more aggressive share purchase program and an 18% increase in its dividend rate funded in part by additional debt, WalMart's credit quality remains strong and stable.
The company should have little trouble absorbing whatever penalties are ultimately imposed from the bribery accusations at WalMart de Mexico, according to independent research firm CreditSights.