Sprint Sells Debt Offering, A Week After Expected
May 03, 2011
More than $800 million of straight corporate debt was priced late Monday and early Tuesday. Federal agencies priced more than $400 million of new debt. The Sprint offering, originally proposed as a $650 million issue, was at first expected to be eagerly snapped up. But the issue, expected to price since last Tuesday, got bogged down amid a glut of other telecommunications offerings and weakening investor demand for the sector. Sprint Corp., 40% owner of Sprint Spectrum LP, had agreed to purchase $100 million of the wireless company's planned $270 million issue of senior discount notes. Sprint Spectrum priced the issue through Merrill Lynch & Co. and Lehman Brothers Inc.. A tranche of $250 million in 10-year senior notes was priced at par to yield 11%, a spread of 4.42 percentage points above comparable Treasurys. The notes are noncallable for five years and include an equity call for 35% of the issue at 111. The second tranche of $273.435 million (proceeds) of 10-year senior discount notes was priced at 54.687 with a 12.5% yield to maturity, a spread of 5.92 percentage points above Treasurys. The face value is $500 million.
