Honda’s U.S. Unit Raises $2.75 Billion in Three-Part Bond Sale

Honda Motor Co. (7267) issued $2.75 billion of U.S. dollar-denominated bonds in three parts.

American Honda Finance Corp., the Japanese automaker’s U.S. finance unit, sold $1.75 billion of three-year debt, comprising $1 billion of 1.125 percent fixed-rate notes yielding 65 basis points more than similar-maturity Treasuries and $750 million of floating-rate securities paying 50 basis points more than the three-month London interbank offered rate, according to data compiled by Bloomberg. It also issued $1 billion of 2.125 percent, five-year debt at a relative yield of 85 basis points.

Three-month Libor was fixed today at 24.3 basis points, or 0.243 percentage point.

The bonds are expected to be rated A1 by Moody’s Investors Service, Bloomberg data show. Proceeds will be used for general corporate purposes.

Honda’s $500 million of 2.6 percent debentures due September 2016 traded at 103.63 cents on the dollar to yield 1.36 percent on Sept. 17, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

Barclays Plc and Deutsche Bank AG managed the offering for the Tokyo-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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