Mubadala Development Co., an Abu Dhabi government-owned investor with stakes in Carlyle Group and General Electric Co. (GE), paid a premium over its existing debt to raise $1.5 billion in bonds.
Mubadala priced $750 million of 3.75 percent notes due April 2016 to yield about 3.98 percent, or 180 basis points more than similar-maturity Treasuries yesterday, according to data compiled by Bloomberg. That is 114 basis points, or 1.14 percentage points, more than the existing 5.75 percent five-year dollar-denonimated bonds, which yielded 2.84 percent today.
“I think Mubadala got a fair deal,” said Abdul Kadir Hussain, who helps oversee $2 billion in fixed-income assets as chief executive officer at Mashreq Capital in Dubai. “They paid a premium to their existing bonds, but this is normal for a new issue, otherwise you risk the bond underperforming.”
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