Volkswagen Raises $3.5 Billion in Biggest U.S. Bond Sale

Volkswagen AG sold $3.5 billion of bonds today in its biggest dollar-denominated sale ever, according to data compiled by Bloomberg.

Europe’s largest automaker issued debt in five parts, including $1.45 billion of 1.25 percent, three-year notes that yielded 47 basis points more than similar-maturity Treasuries, Bloomberg data show.

Proceeds will be used for general corporate purposes, including working capital, according to a person with knowledge of the matter who asked not to be identified because they weren’t authorized to speak publicly about it.

The notes were issued on the same day Bayerische Motoren Werke AG’s Chief Executive Officer Norbert Reithofer said 2014 “will be a year of growth opportunities” for automakers, citing rising demand in North America and China, and a European car market showing signs of recovery.

Volkswagen, based in Wolfsburg, Germany, also sold $1 billion of 2.125 percent, five-year notes, $500 million of three-year, floating rate securities at 37 basis points more than the London interbank offered rate, $250 million of two-year floating-rate bonds at 22 basis points more than Libor and $300 million of 18-month notes at 17 basis points more than Libor.

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