MCDONALD’S sold US$1 billion of bonds on Tuesday (May 14) that may help the fast-food giant refinance debt due in the coming months.
The company is issuing US$500 million each of five- and 10-year notes, according to a source with knowledge of the matter. The 10-year bond was priced 0.8 percentage point above comparable Treasuries, said the source, who asked not to be identified because they are not authorised to speak about it. Early price talk ranged from 1.05 to 1.1 points.
McDonald’s did not respond to a request for comment.
Bloomberg Intelligence senior credit analyst Jody Lurie wrote in a Tuesday note that she expects some of the proceeds to go towards refinancing US$1.5 billion in debt due later this year.
The offering comes two weeks after McDonald’s reported first-quarter results that fell short of estimates, hampered by slowing growth in the US and reverberations of the Israel-Hamas war. Bloomberg News reported earlier this month that the company is looking to launch a US$5 meal deal in the US in hopes of luring back money-conscious consumers.
The deal is McDonald’s first US dollar-bond sale since last August’s US$2 billion offering. Concurrently, the company has launched a C$1 billion (S$991 million) note in Canada.
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Bank of America, RBC Capital Markets, Mitsubishi UFJ Financial Group and US Bancorp managed the US bond sale, the source said. BLOOMBERG
