AT&T Inc. sold $2 billion in debt 6/3, receiving good demand from investors for its first bond sale since announcing its planned $49 billion acquisition of DirecTV. AT&T offered 30-year bonds to yield 1.40 percentage points more than comparable U.S. Treasurys, for a yield of around 4.8%. Earlier Tuesday morning, the bonds were being shopped to yield closer to 1.50 percentage points more than Treasurys. Lower yields indicate higher prices, and underwriters typically lower the yield when there is solid interest from buyers. The telecommunications company received about $4.2 billion in investor orders for the bonds.
Last month, analysts said AT&T could sell as much as $7.5 billion in debt to help pay for the DirecTV acquisition, so AT&T could sell additional bonds in the coming months. A draft prospectus said proceeds from Tuesday’s sale would be used for “general corporate purposes,” including paying off outstanding debt, reports MarketWatch.