Seeking Alpha

Caterpillar said to plan 50-year debt as part of $2B sale

  • Caterpillar (CAT) reportedly is planning to sell $2B of notes including the first 50-year bonds offered in the U.S. in nearly a year, with the $500M of debt due 2064 said to price to yield 137.5 bps more than Treasurys.
  • The bonds apparently were added to the offering, which includes $1B of 10-year notes and $500M of 30-year securities, after it was marketed earlier today.
  • In addition, the 2024 bonds may price to yield 80 bps more than similar maturity government debt and the 2044 securities may pay a 95 bps spread.
Comments (4)
  • John Grandits
    , contributor
    Comments (456) | Send Message
     
    1.38% over treasuries, the demand for yield continues. Apple recently sold a whack of bonds too at 75 bps over treasuries. Curious to know where all this demand is coming from???
    5 May 2014, 06:12 PM Reply Like
  • King Rat
    , contributor
    Comments (833) | Send Message
     
    As the tapering stimulus is suppressing long term rates, this is the result. I'd be curious to see what rates 20+ year corporate bonds collect a year from now.

     

    What I am curious is how they calculate the theoretical yield on theoretical 50 year treasuries.
    5 May 2014, 07:59 PM Reply Like
  • jumpnjoey77
    , contributor
    Comments (718) | Send Message
     
    AAPL did not sell 50 year bonds. Hence the higher yield.
    6 May 2014, 12:30 AM Reply Like
  • goblue5876
    , contributor
    Comments (162) | Send Message
     
    People are still scared and desperate for safety and some "guaranteed" income. I quote guaranteed because inflation has to be at least 2-3% over this time, likely to go higher.
    23 May 2014, 12:12 PM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Hub
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs