Bloomberg Anywhere Remote Login Bloomberg Terminal Demo Request


Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.


Financial Products

Enterprise Products


Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000


Industry Products

Media Services

Follow Us

Bloomberg Customers

FedEx Sells $1 Billion Issue With First 30-Year Bond Since 1989

FedEx Corp. raised $1 billion in a two-part offering today, including its first 30-year bond in more than two decades.

The world’s largest cargo airline issued $500 million each of 2.625 percent bonds due in 2022 that yielded 125 basis points more than similar-maturity Treasuries and 3.875 percent, 30-year debt with a 150 basis-point spread, according to data compiled by Bloomberg. FedEx, rated three levels above junk at Baa1 by Moody’s Investors Service, last sold 30-year bonds in 1989, when it issued $100 million of 9.625 percent debt that was called in 2000, the data show.

Borrowing costs for FedEx at 2.13 percent are less than the 3.37 percent average among peers, according to the Bank of America Merrill Lynch U.S. corporate transportation index. The company plans to boost air cargo profit margins to at least 10 percent, partly by replacing junkyard-ready jets with more efficient models. The gauge was 4.8 percent in fiscal 2012 that ended in May.

“FedEx’s massive international shipping network would be difficult and costly to duplicate, earning the company a narrow economic moat,” Jeffrey Cannon, an analyst at Chicago-based Morningstar Inc., wrote today in a research note.

The extra yield investors demand to own its 8 percent bonds due in 2019 instead of government securities was 96.2 basis points June 27, giving the note a yield of 2.59 percent, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. The spread on higher-rated United Parcel Service Inc.’s similar-maturity 5.125 percent debt was 15 basis points June 28 with a 1.72 percent yield.

UPS, the world’s largest package-delivery company, cut its full-year forecast today after a drop in international sales dragged quarterly profit below analysts’ estimates.

Goldman Sachs Group Inc. and JPMorgan Chase & Co. managed the new debt sale, according to a regulatory filing.

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.