Verizon Bond Issue

On Wed 9th of September, Verizon, the US Telecommunications giant, issued some bonds. Nothing new or unusual in that. Except, this issue, was to raise US$49 Billion = £30.7 Billion.

It was the largest ever corporate debt sale in history. They issued US$49 Billion worth of bonds in 8 blocks, that were a mix of fixed and floating-rate debt spread across six different maturities that ranged from three years to 30 years. The interest (the yield / coupon) on the pile of debt was over 5%.

Clearly the money being raised is to finance the purchase of the 45% of Verizon Wireless that is owned by Vodafone PLC. The sale of these Verizon bonds, was managed by Barclays Plc, Bank of America Corp., JPMorgan Chase & Co. and Morgan Stanley.

5% yield in these near zero interest rates, Verizon are rewarding investors with a generous interest rate.

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