US telecoms giant Verizon Communications is to raise up to US$49bn through a bond offering to carru through the planned buyout of Vodafone, its current partner in the Verizon Wireless joint venture.
The sale by the New York-based company would easily surpass the previous biggest corporate-bond sale, the US$17bn offering in April by Apple Inc.
Reports suggest that the sale will encourage other prospective corporate bond issuers, which are finding a ready market for financing as they consider expanding via investment or purchases against the backdrop of a strengthening US economy and a continuing low interest rate environment. It also promises substantial fees for the Wall Street banks that put together merger and acquisition (M&A) deals.
The reports also indicate that demand for the debt has surprised even the banks selling the bonds, with Verizon receiving more than US$90bn worth of investor orders. The company initially expected to sell about US$20bn of debt this week but repeatedly increased that target as orders continued to arrive.
The steady growth in the size of the offering is seen as evidence of the eagerness among many large companies to sell debt ahead of a meeting next week by the US Federal Reserve. Some investors expect the central bank to reduce its monetary stimulus in a shift that would likely lead to higher interest rates.
The pricing is expected to be attractive to investors, with 10-year Verizon bonds likely to yield about 2.25 percentage points more than comparable Treasurys, compared with 1.66 percentage points on an existing nine-year bond, according to MarketAxess.
The US money market fund reforms came into effect in 2016 and are already dramatically shaping US fund industry with investors flooding out of prime funds and into government securities. While the reforms are similar, they are not the same. GTNews interviews Yeng Bulter, global head of the cash business at State Street Global Advisors on the differences.
Far and away, the largest financial market on the planet is the foreign exchange currencies market, where on average individuals and organisations trade more than $5 trillion daily. In the FX world, the ability to master the market isn't considered a luxury for treasury officers–it's a necessity.
Treasurers are more interested in cross-border payments and automation than real-time payments, as they are consistently asked to do more with less, argues Rick Burke, head of corporate payments at TD Bank in an exclusive interview.
The top five sectors Asian fintech investors are interested in are data analytics, blockchain, lending, payments and regtech, according to Gary Hwa, EY regional managing partner.