Verizon holds record bond sale

Sept. 11, 2013 at 5:36 PM
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NEW YORK, Sept. 11 (UPI) -- Strong demand pushed yields down and prices higher for Verizon Communications Inc. bonds, as the firm completed a record bond sale in New York Wednesday.

In the bond market, yields and prices go in opposite directions. The higher the demand, the more prices rise, which allows interest rates to drop.

Verizon Wednesday broke the corporate bond sale record with an issuance of $49 billion in debt to help fund a $130 billion deal in which it plans to buy Vodafone's 45 percent stake of Verizon Wireless.

MarketWatch reported Verizon sold three-, five-, 10-, 20- and 30-year notes, with 10-year notes reaching 5.192 percent, a 2.25 percentage point spread over 10-year treasuries.

Verizon sold $15 billion worth of 30-year fixed-rate notes, $6 billion of 20-year fixed-rate bonds, $11 billion of 10-year fixed-rate bonds, $4 billion of seven-year notes, $4.75 of five-year notes and $4.25 billion of three-year notes.

The lowest spread was in three-year notes, where the yield spread was 1.65 percentage points.

The company sold $2.25 billion in three-year floating rate notes at 1.53 percent above the Libor benchmark and $1.75 billion in floating rate five-year notes at 1.75 percent above Libor, the London interbank offered rate.

The next-largest corporate bond sale ever was issued by Apple Inc. in April, a package that totaled $17 billion.

The second-largest bond sale was a February 2009 issuance of $16.3 billion worth of bonds.

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