PepsiCo launches USD2bn two-part bond

Tue Feb 25, 2014 1:28pm EST

NEW YORK, Feb 25 (IFR) - PepsiCo on Tuesday launched a USD2bn two-part bond after the food and beverage giant gave up plans for a third floating-rate tranche of the deal.

The A1/A-/A rated deal comprises a USD750m three-year piece launched at Treasuries +30bp and a USD1.25bn 10-year launched at T+92bp.

That was significantly tighter than initial price thoughts of low 40s and 105bp area out earlier in the day. A three-year floating-rate note had also been planned.

PepsiCo's outstanding 1.25% August 2017s are trading at a G spread of 34bp, while its 2.75% March 2023s are at G+94bp. Based on the launch levels, the new trade appears to have a negative new issue concession on both tranches.

Active bookrunners on the deal are Citigroup, RBS and UBS.

A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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