Oracle announces four-part notes offering; price talk emerges

By Cristal Cody

Chicago, Nov. 7 – Oracle Corp. entered the Monday market with a four-part offering of notes (expected Baa2/BBB/BBB+), according to a 424B2 filing with the Securities and Exchange Commission.

The company borrowed a $15.7 billion delayed-draw term loan on June 8 for its acquisition of Cerner Corp.

To date, the company borrowed $4.4 billion under a term loan in August and then added another $1.3 billion to the term loan to partially repay the bridge loan.

The notes from the offering will be used to prepay the bridge loan on a dollar-for-dollar basis.

The offering has been long-awaited, anticipated in the spring and expected in the summer.

The offering announced on Monday is comprised of fixed-rate notes with maturities in 2025, 2029, 2032 and 2052.

All four notes will have make-whole provisions. For the 2025 notes, the make-whole redemption premium will be throughout the life of the notes. For the other three notes, there will be par calls a number of months before each maturity date.

BofA Securities, Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, HSBC Securities (USA) LLC and J.P. Morgan Securities LLC are leading the sale.

BNP Paribas Securities Corp., Deutsche Bank Securities Inc., PNC Capital Markets LLC and SMBC Nikko Securities America, Inc. are also listed as bookrunners.

Price talk on the notes due Nov. 10, 2025 is in the Treasuries plus 155 basis points area, according to a market source. JPMorgan will handle billing and delivery on this tranche.

Talk on the notes due Nov. 9, 2029 is in the Treasuries plus 230 bps area. Billing and delivery for this tranche will come from Goldman Sachs and HSBC.

The notes due Nov. 10, 2032 have spread talk in the 250 bps area with billing and delivery coming from Citigroup.

In the longest tranche, due Nov. 10, 2052, price talk emerged in the 310 bps area over Treasuries. BofA Securities will handle billing and delivery.

Bank of New York Mellon Trust Co., NA is the trustee.

Counsel to the issuer is provided by Freshfields Bruckhaus Deringer US LLP and to the underwriters by Simpson Thacher & Bartlett LLP.

The senior notes will rank equal in right of payment to $91.5 billion of other borrowings. The company had $135.8 billion of total liabilities outstanding as of Aug. 31.

The computer software and technology company is based in Austin, Tex.

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