McDonald’s $750 Million Bond Offering
McDonald’s Plans $750 Million Bond Issue After Record-Low Coupon
McDonald’s Corp. (MCD) plans to sell $750 million of bonds almost four months after the world’s largest restaurant chain claimed the lowest yield on 30-year debt, according to a person familiar with the offering.
Proceeds from the two-part sale of three- and seven-year notes will be used for general corporate purposes and may be rated A2 by Moody’s Investors Service and an equivalent A by Standard & Poor’s, said the person, who asked not to be identified because terms aren’t set.
The Big Mac seller is borrowing money as it plans to hire 70,000 people in China this year, almost doubling its workforce there, and accelerates new store openings in the Asian nation to compete with Yum! Brands Inc.’s KFC and Pizza Hut.
McDonald’s paid a 3.7 percent coupon on its $500 million of 30-year bonds sold Feb. 2, a record low for the maturity, according to data compiled by Bloomberg. The securities traded at 97.4 cents on the dollar to yield 3.85 percent May 18, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.
Bank of America Corp., Goldman Sachs Group Inc., JPMorgan Chase & Co., Morgan Stanley and Wells Fargo & Co. are managing the sale for the Oak Brook, Illinois-based company, the person said.