TORONTO, Oct 3 (Reuters) - Walt Disney Co DIS.N is seeking to raise at least C$750 million in its first issue of maple bonds, a term sheet seen by Reuters showed, becoming the latest large U.S. corporation to tap this market in recent months.
Guidance for the issue by private placement of senior unsecured notes, which will mature on Oct. 7, 2024, has been set at a spread of 84 basis points plus or minus 3 basis points versus the Government of Canada curve, the term sheet showed.
Pricing of the proposed offering, which has been rated A2 by Moody's, is expected on Tuesday, a source familiar with the issue said. Maple bond market, in which foreign companies sell Canadian dollar-denominated debt, has attracted issuance from a number of high profile names this year, including AB InBev, McDonald's Corp (NYSE:MCD) MCD.N and Apple Inc AAPL.O .
Apple priced a C$2.5 billion deal in seven-year bonds in August, setting a record amount for an issuer in the Maple bond market. The deal also tied as the biggest corporate issue in Canada. players say that foreign issuers often issue Canadian dollar denominated debt when they can swap the proceeds into U.S. dollars and achieve a cheaper overall borrowing cost.
The deal comes after two interest rate hikes by the Bank of Canada in recent months helped push Canadian bond yields higher, attracting interest from global bond investors. could also be attracted by a pool of domestic buyers hungry to diversify in a Canadian dollar corporate bond market denominated by large financial issuers.
Disney intends to use the net proceeds from the sale of the notes for general corporate purposes.