McDonald's Launches $750 Million Bond Deal >MCD

28th Jul 2010 19:26

By Chris Dieterich Of DOW JONES NEWSWIRES NEW YORK (Dow Jones)--McDonald's Corp. (MCD) was selling a $750 million bond in two parts Wednesday, its first debt sale in more than a year and a half. The fast-food giant launched $450 million in 10-year notes at 55 basis points over comparable Treasurys, according to a syndicate banker familiar with the issue. McDonald's also launched $300 million worth of 30-year notes at 85 basis points over comparable Treasurys. Both tranches in the debt issue launched 5 basis points tighter then preliminary guidance. A company spokeswoman said part of the proceeds likely will be used to pay off other debt coming due this year. McDonald's is tapping debt markets now to take advantage for favorable rates, the spokeswoman said. McDonald's last sold debt on Jan. 13, 2009, also a $750 million issue. The largest McDonald's debt issue on record was a $2.25 billion issue on Feb. 26, 2008, according to data provider Dealogic. The company's outstanding long-term bonds weakened in secondary trading Wednesday. McDonald's 6.3% notes due March 2038 last traded down 1 3/4 points to yield 4.999%, or 90 basis points over Treasurys. Moody's Investors Service rates McDonald's debt A3, and Standard & Poor's gives an A rating to the company's debt. The issue is being led by joint managers Bank of America Merrill Lynch, J.P. Morgan and Royal Bank of Scotland. -By Chris Dieterich, Dow Jones Newswires; 212-416-2611; [email protected] -0- (END) Dow Jones Newswires July 28, 2010 14:26 ET (18:26 GMT)