McDonald’s tests primary corporate bond market

Posted May 26, 2010 at 6:47 a.m.

Dow Jones Newswires | Two corporate bond deals are in the
primary market Wednesday, with McDonald’s Corp. and Swiss cement maker
Holcim both offering Swiss franc-denominated bonds. There has been a
dearth of such issuance in May as volatility has prevented companies
from coming to the primary market for funding.

“These are just what the market is shouting for these days,” said a
syndicate banker of corporate deals, noting the contrast with the
unfavorable sentiment surrounding banks and sovereign governments.

Holcim has set guidance on its CHF200 million, six-year bond in the area of 105 basis points over mid-swaps, one of the banks running the sale said Wednesday.

Royal Bank of Scotland PLC, BNP Paribas SA, Credit Suisse Group and Zurcher Kantonalbank are lead managers on the deal.

For McDonald’s, guidance on its CHF250 million issue has been set at 50 basis points over mid-swaps, said one of the lead managers on the deal, which is being run by RBS and UniCredit SpA.

Order books closed above CHF1 billion, “showing the level of demand for this kind of asset,” a syndicate banker said.

Both deals are expected to price later today, subject to market conditions.

Holcim is rated Baa2 by Moody’s Investor Services Inc, and BBB by Standard and Poor’s Corp and Fitch Ratings Inc, while McDonald’s is rated A3 by Moody’s and A by S&P.


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