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Westfield Retail Seeks A$500 Million in Debut Sale of Bonds

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April 11 (Bloomberg) -- Westfield Retail Trust started marketing at least A$500 million ($529 million) of bonds in the Australia and New Zealand mall owner’s inaugural debt sale after being split off from Westfield Group last year.

The company is seeking to price the notes, maturing in October 2016, to yield about 120 basis points more than the swap rate, according to an e-mailed statement from Commonwealth Bank of Australia, which is helping to manage the sale.

Westfield Group announced the creation of the retail trust in November to take 50 percent stakes in its 54 Australian and New Zealand shopping centers, allowing the main entity to pursue more developments and acquisitions. It said at the time that Westfield Retail may sell bonds to help refinance bank debt.

Westfield Retail is rated A+ by Standard & Poor’s, the fifth-highest grade and two rungs higher than Westfield Group, which is rated A-.

It had A$2.8 billion in bank loan facilities as of Dec. 31, including A$1 billion split between three- and five-year facilities, and A$895 million of bridge loans, according to a regulatory filing.

The trust part-owns assets including the Sydney City center that opened in October, Westfield Bondi Junction, also in Sydney, and the Doncaster Center in Melbourne, according to its website.

A sale of A$500 million of bonds would match the biggest non-financial corporate deal in Australia this year, a sale of five-year 6.75 percent notes by Woolworths Ltd., according to data compiled by Bloomberg.

Australia & New Zealand Banking Group Ltd., National Australia Bank Ltd. and Westpac Banking Corp. are also helping manage Westfield Retail’s debt sale.

To contact the reporter on this story: Sarah McDonald in Sydney at smcdonald23@bloomberg.net.

To contact the editor responsible for this story: Will McSheehy at wmcsheehy@bloomberg.net.