Ford Loonie Junk Bond Lures Buyers With Yield Pickup Over Dollar
- Largest widely marketed junk deal in Canadian dollars in 2020
- New bonds traded tighter after pricing Monday afternoon
A worker wearing a protective mask holds a Ford sign before a news conference at the Ford Connectivity and Innovation Centre in Ottawa, Canada, in October.
Photographer: David Kawai/BloombergFord Motor’s credit unit in Canada priced the largest widely marketed bond from a high-yield issuer since 2019, with the new notes offering significantly more yield than similar securities issued in the dollar market.
Ford Credit Canada priced C$600 million ($460 million) of three-year bonds to yield 3.5%, in the largest junk-rated deal since Videotron priced a C$800 million transaction in late 2019, according to Bloomberg data. The bonds, which rallied after pricing yesterday, are quoted Tuesday at an equivalent spread over the U.S. yield curve of around 315 basis points, about 40 basis points wider than a comparable bond issued in the U.S.