Siemens $6 billion six tranche yankee bond issue

Overview:

• Siemens sold $6 billion in 144A/Reg S bonds in six tranches, taking advantage of favorable financing conditions and strong investor appetite in the States.
• The German engineering group issued notes with maturities of three, five, seven, 10 and 30.
• Two of the tranches had maturities of three years: $350 million floating rate (three month US dollar libor rate plus 32 basis points) notes and $1.1 billion 1.3% notes.
• The other tranches were all fixed rate: $1.1 billion 1.7% notes, maturing September 2021; $750 million 2% notes, maturing September 2023; $1.7 billion 2.35% notes, maturing October 2026; and $1 billion 3.3% notes, maturing 2046.
• Siemens said the proceeds of the bond would be used to refinance outstanding debt and for general corporate purposes
• The bond is the second largest ever sold by the company, only surpassed by its $7.75 billion issue in 2015.   
• Early September 2016 saw corporates in the US and Europe sell tens of billions of dollars in debt in anticipation of policy changes in Europe, Japan and the US later that year, which were expected to destabilise international debt markets. 
• In terms of US debt issues, the total value of bonds sold in 2016 has only been bettered by that of 2015, with more than $1.1 trillion issued. 

Ben Naylor - EMEA editor