AT&T Inc., the second-largest U.S. wireless carrier, sold $5 billion of bonds to help pay back debt maturing this year.

AT&T sold $1.5 billion of 2.4 percent, five-year notes that yield 148 basis points more than similar-maturity Treasuries, $1.5 billion of 3.875 percent, 10-year debt at a spread of 160 basis points and $2 billion of 5.55 percent, 30-year bonds that pay 185 basis points more than benchmarks, according to data compiled by Bloomberg. Proceeds may also be used for general corporate purposes, said a person familiar with the offering, who declined to be identified because the terms are private.

Corporate bond offerings are showing signs of life, with borrowers from Occidental Petroleum Corp. to San Diego Gas & Electric Co. joining Dallas-based AT&T in tapping the market as yields on investment-grade debt hover at about the lowest on record. Sales rose 37.6 percent last week to $13.6 billion after falling to the lowest since June during the period ended Aug. 5, Bloomberg data show.

AT&T has $3.25 billion of bonds coming due this year, according to Bloomberg data. Fitch Ratings said the company planned to sell about $4 billion of bonds earlier today.

Barclays Plc and JPMorgan Chase & Co. managed AT&T's offering, Bloomberg data show. Fitch assigned the notes a grade of A, it said today in a statement. The company is rated A2 by Moody's Investors Service and A-, one step lower, by Standard & Poor's.

Previous Sale
AT&T last sold bonds on April 26, when it issued $1.75 billion of five-year, 2.95 percent notes that yielded 97 basis points more than similar-maturity Treasuries and $1.25 billion of 10-year, 4.45 percent debt that paid a spread of 115 basis points, Bloomberg data show. A basis point is 0.01 percentage point.

The notes due May 2016 traded at 104.4 cents on the dollar on Aug. 12 to yield 1.98 percent, 102 basis points more than benchmarks, according to Trace, the bond price reporting system of the Financial Industry Regulatory Authority.

Yields on bonds in the Bank of America Merrill Lynch U.S. Corporate Master Index averaged 3.64 percent on Aug. 12 after touching 3.503 percent on Aug. 9, the lowest in daily data extending to October 1986.

Verizon Wireless is the biggest U.S. wireless carrier.

Bloomberg News

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AT&T Sells $5 Bln of Bonds

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