IBM 10-Yrs at Record Low Coupon

$1 billion of debt sold at 1.875% coupon, yielding 65 basis points over Treasuries.

International Business Machines Corp. sold $1 billion of 10-year bonds at 1.875 percent, the lowest coupon on record for dollar-denominated debt of that maturity.

The world’s largest computer-services provider obtained a relative yield of 65 basis points more than similar-maturity Treasuries, according to data compiled by Bloomberg. The coupon beat the previous 2 percent record held by 3M Co.’s 10-year notes sold on June 21. A basis point is 0.01 percentage point.

IBM also shares the record low with Sysco Corp. for three-year debt with its 0.55 percent bonds due February 2015.

The new debt may be rated Aa3, the fourth-highest level of investment grade, by Moody’s Investors Service. Proceeds will go toward general corporate purposes, according to a person familiar with the transaction, who asked not to be identified because the terms are private.

IBM last sold 10-year bonds in October 2011, issuing $500 million of 2.9 percent debt to yield 62.5 basis points more than benchmarks, Bloomberg data show. The Armonk, New York-based company’s securities traded at 108.34 cents on the dollar to yield 1.91 percent on July 19, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

BNP Paribas SA, Citigroup Inc., Deutsche Bank AG and UBS AG managed the sale, according to Bloomberg data.


Bloomberg News


Copyright 2017 Bloomberg. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.


Advertisement. Closing in 15 seconds.