Nestle SA (NESN) increased the size of its first sale of dollar bonds in four months to $500 million as European companies tap U.S. debt markets at the fastest pace in a year-and-a-half.
The world’s largest food company joined borrowers from Barclays Plc to French oil company Total SA that raised a total $49 billion from dollar bonds in September, the biggest monthly sales tally since March 2011, according to data compiled by Bloomberg. European issuers sold $15 billion of so-called Yankee bonds this month.
Nestle’s senior unsecured bonds due January 2018 were priced to yield 43 basis points more than the benchmark swap rate, down from about 50 basis points offered in initial marketing, according to people with knowledge of the transaction. The Vevey, Switzerland-based company initially sought a minimum $300 million from the offering.
“Nestle has a large market in the U.S. and they’ve issued dollar bonds before,” said Juan Esteban Valencia, a credit strategist at Societe Generale SA in Paris.
Robin Tickle, a spokesman for Nestle, declined to comment.
Nestle’s $900 million of 1.375 percent bonds due 2017 sold in June yield 42 basis point more than the swap rate, compared with an issue spread of 40 basis points, data compiled by Bloomberg show.
The company, which has $10 billion of bonds outstanding, is rated Aa2 by Moody’s Investors Service and AA by Standard & Poor’s.
Credit Suisse Group AG, Goldman Sachs Group Inc., Mitsubishi UFJ Financial Group Inc. and UBS AG managed the deal.
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