Imperial Tobacco Raises $2.25 Billion in Two-Part Dollar Bonds

Imperial Tobacco Group Plc (IMT), the maker of West and Davidoff cigarettes, issued $2.25 billion of bonds in its first long-term, dollar-denominated debt sale since 1999.

The company’s $1.25 billion of 2.05 percent, five-year debt yields 120 basis points more than similar-maturity Treasuries and $1 billion of 3.5 percent, 10-year securities has a relative yield of 150 basis points, according to data compiled by Bloomberg.

The bonds are its first benchmark issue, typically at least $500 million, in the U.S. since it sold $600 million of 7.125 percent, 10-year debt that matured in April 2009, Bloomberg data show.

Proceeds will be used for working capital, share repurchases and to refinance, repay or repurchase debt, as well as for general corporate purposes, according to a person familiar with the transaction, who asked not to be identified citing lack of authorization to speak publicly.

Bank of America Corp., Barclays Plc, Citigroup Inc. and Morgan Stanley managed today’s offering for the Bristol, England-based company, Bloomberg data show.

To contact the reporter on this story: Sarika Gangar in New York at sgangar@bloomberg.net

To contact the editor responsible for this story: Alan Goldstein at agoldstein5@bloomberg.net

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