By Cristal Cody
Tupelo, Miss., Nov. 20 – Starbucks Corp. priced $1 billion of senior notes (A3/A-/A-) in two tranches on Monday, according to a market source and an FWP filing with the Securities and Exchange Commission.
The company sold $500 million of 2.2% three-year notes at 99.919 to yield 2.228%. The notes priced with a spread of 37 basis points over Treasuries.
Starbucks priced $500 million of 3.75% 30-year notes at 99.731 to yield 3.765%, or a Treasuries plus 97 bps spread.
The notes priced on the tight side of guidance.
Citigroup Global Markets Inc., Goldman Sachs & Co. LLC and U.S. Bancorp Investments, Inc. were the bookrunners.
The notes have a 101% change-of-control put.
Proceeds will be used for general corporate purposes, including the repurchase of common stock, business expansion, payment of cash dividends on common stock or financing possible acquisitions.
Starbucks is a Seattle-based specialty coffee retailer.
| Issuer: | Starbucks Corp.
|
| Amount: | $1 billion
|
| Description: | Senior notes
|
| Bookrunners: | Citigroup Global Markets Inc., Goldman Sachs & Co. LLC and U.S. Bancorp Investments, Inc.
|
| Co-managers: | HSBC Securities (USA) Inc., Rabo Securities USA, Inc., Loop Capital Markets LLC, SunTrust Robinson Humphrey, Inc., Fifth Third Securities, Inc., Academy Securities, Inc. and Mischler Financial Group, Inc.
|
| Change-of-control put: | 101%
|
| Trade date: | Nov. 20
|
| Settlement date: | Nov. 22
|
| Ratings: | Moody’s: A3
|
| S&P: A-
|
| Fitch: A-
|
| Distribution: | SEC registered
|
|
|
| Three-year notes
|
| Amount: | $500 million
|
| Maturity: | Nov. 22, 2020
|
| Coupon: | 2.2%
|
| Price: | 99.919
|
| Yield: | 2.228%
|
| Spread: | Treasuries plus 37 bps
|
| Call features: | Make-whole call at greater of par and Treasuries plus 10 bps at any time
|
| Price guidance: | Treasuries plus 40 bps area
|
|
|
| Thirty-year notes
|
| Amount: | $500 million
|
| Maturity: | Dec. 1, 2047
|
| Coupon: | 3.75%
|
| Price: | 99.731
|
| Yield: | 3.765%
|
| Spread: | Treasuries plus 97 bps
|
| Call features: | Make-whole call at greater of par and Treasuries plus 15 bps before June 1, 2047; thereafter at par
|
| Price guidance: | Treasuries plus 100 bps area
|
|
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