Altria to tap European bond market to help fund Juul stake buy
Altria Group will tap the European investment grade corporate bond market to help finance its $12.8 billion purchase of a stake in e-cigarette maker Juul Labs Inc, the Marlboro maker said in a regulatory filing on Monday.
The tobacco company said it would issue the bonds in four tranches in denominations of 100,000 euros as it looks to prepay a term loan arranged by JPMorgan Chase & Co to fund the deal. That loan matures on Dec. 19, 2019.
The four-year tranche is expected to price at 110 to 115 basis points above the midswaps rate, according to pricing guidance published by Refinitiv`s IFR.
Altria`s deal for a 35 percent stake in the controversial e-cigarette maker Juul, along with a stake buy in Canadian cannabis company Cronos Group Inc in December last year, roughly doubled the company`s total debt.
The sharp increase in leverage was among the reasons behind rating agencies Standard & Poor`s and Fitch`s two-notch downgrades of Altria`s credit rating in December.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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