By Cristal Cody
Tupelo, Miss., April 16 – Costco Wholesale Corp. priced $4 billion of senior notes (Aa3/A+) in three parts on Thursday, according to a market source and an FWP filing with the Securities and Exchange Commission.
A $1.25 billion tranche of 1.375% notes due June 20, 2027 priced at 99.775 to yield 1.408%, or a spread of Treasuries plus 90 basis points.
Initial price talk was in the Treasuries plus 145 bps area.
The company sold $1.75 billion of 1.6% 10-year notes at 99.825 to yield 1.619% and a Treasuries plus 100 bps spread, compared to talk at the 145 bps spread area.
In the final tranche, $1 billion of 1.75% notes due April 20, 2032 priced at 99.795 to yield 1.769% and a spread of 115 bps over Treasuries.
The notes were initially guided to print in the 165 bps over Treasuries area.
Credit Suisse Securities (USA) LLC, BofA Securities, Inc. and Citigroup Global Markets Inc. were the bookrunners.
Proceeds are expected to be used to repay at or prior to maturity all of the company’s $1 billion of 2.15% senior notes due 2021 and all of its $500 million of 2.25% senior notes due 2022 and for general corporate purposes.
The membership warehouse is based in Issaquah, Wash.
| Issuer: | Costco Wholesale Corp.
|
| Amount: | $4 billion
|
| Description: | Senior notes
|
| Bookrunners: | Credit Suisse Securities (USA) LLC, BofA Securities, Inc., Citigroup Global Markets Inc., U.S. Bancorp Investments, Inc., HSBC Securities (USA) Inc., Drexel Hamilton, LLC and Guzman and Co.
|
| Trade date: | April 16
|
| Settlement date: | April 20
|
| Ratings: | Moody’s: Aa3
|
| S&P: A+
|
| Distribution: | SEC registered
|
|
|
| Seven-year notes
|
| Amount: | $1.25 billion
|
| Maturity: | June 20, 2027
|
| Coupon: | 1.375%
|
| Price: | 99.775
|
| Yield: | 1.408%
|
| Spread: | Treasuries plus 90 bps
|
| Call features: | Make-whole call before April 20, 2027 at Treasuries plus 15 bps; thereafter at par
|
| Price guidance: | Treasuries plus 145 bps area
|
|
|
| 10-year notes
|
| Amount: | $1.75 billion
|
| Maturity: | April 20, 2030
|
| Coupon: | 1.6%
|
| Price: | 99.825
|
| Yield: | 1.619%
|
| Spread: | Treasuries plus 100 bps
|
| Call features: | Make-whole call before Jan. 20, 2030 at Treasuries plus 15 bps; thereafter at par
|
| Price guidance: | Treasuries plus 145 bps area
|
|
|
| 12-year notes
|
| Amount: | $1 billion
|
| Maturity: | April 20, 2032
|
| Coupon: | 1.75%
|
| Price: | 99.795
|
| Yield: | 1.769%
|
| Spread: | Treasuries plus 115 bps
|
| Call features: | Make-whole call before Jan. 20, 2032 at Treasuries plus 20 bps; thereafter at par
|
| Price guidance: | Treasuries plus 165 bps area
|
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