Motorola Solutions Inc. (MSI) sold $1.4 billion of bonds in its biggest issue in almost seven years to help fund pension contributions and refinance debt.
The maker of two-way radios and other communications equipment sold equal, $400 million portions of 3.5 percent notes due 2021 and 5.5 percent bonds due 2044, according to data compiled by Bloomberg. The debt offering, the biggest for Motorola Solutions since October 2007, also included $600 million of 4 percent debentures due in 2024, Bloomberg data show.
Proceeds will be partly used to redeem $400 million of 6 percent, senior notes due 2017, according to a regulatory filing. The company’s net pension obligation totaled $1.2 billion in the U.S. as of the end of fiscal year 2013, according to a statement from Moody’s Investors Service analysts led by Matthew Jones.
The notes due 2021 yielded 160 basis points more than similar-maturity Treasuries while the bonds that mature in 2044 were sold at 225 basis points more than benchmarks, Bloomberg data show. The 10-year notes paid a spread of 180 basis points.
Motorola Solutions last issued bonds in February 2013, when it sold $600 million of 3.5 percent notes due 2023 that yielded 175 basis points more than Treasuries, Bloomberg data show.