Disney Returns to Investment-Grade Bond Market After Four-Year Hiatus

Stock News
Feb 10

Walt Disney (DIS.US) has reentered the U.S. dollar investment-grade bond market for the first time since 2020, launching a high-grade dollar bond issuance on Tuesday. The move places Disney among a wave of companies seizing the opportunity to lock in financing costs as borrowing spreads decline. According to informed sources, Disney's bond offering is structured into up to four tranches with maturities ranging from 3 to 10 years. The preliminary pricing guidance for the longest-term bond is approximately 0.85 percentage points above the yield on U.S. Treasuries of comparable maturity. Proceeds from the issuance are intended for general corporate purposes. This transaction is one of eight issuances in the U.S. investment-grade bond market on Tuesday. Just one day earlier, Alphabet (GOOG.US, GOOGL.US) raised $20 billion through a bond offering, attracting over $100 billion in orders, underscoring strong investor appetite for high-quality corporate debt. The bookrunners for Disney's bond issuance reportedly include BNP Paribas, Citigroup, Deutsche Bank, JPMorgan Chase, Sumitomo Mitsui Banking Corporation, and U.S. Bancorp. The new bonds are expected to receive ratings of A2 from Moody's and A from S&P Global. Market analysts suggest that by returning to the bond market amid narrowing financing spreads and robust demand, Disney is positioned to raise capital under relatively favorable terms, reflecting the ongoing vibrancy of the U.S. investment-grade bond market.

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