We knew something was coming to afford to buy the rest of the Boots Pharmacy chain and cut backs would not allow this kind of money so a bond sale it was and now the company is rated at Baa2, two points above “junk”. Walgreens already owned 45% of Boots from 2012. The rest of the cost is over $15 billion.
This bond sale will end up being one of the larges of the year. More companies have been turning to bond sales of late.
Corporate debt has posted better returns than many other assets. Other companies may tap in more of the debt market before the end of the year too. Apple still holds the record for the largest bond sale this year at $12 billion. BD
Walgreens Boots Alliance Inc. sold $8 billion of bonds as it prepares to pay about $15.3 billion for the portion of Alliance Boots it doesn’t already own.
The biggest piece of the seven-part, dollar-denominated offering was $2 billion of 10-year, 3.8 percent notes, according to data compiled by Bloomberg. Walgreen Co. (WAG) previously controlled about 45 percent of Alliance Boots, the Swiss company that runs pharmacy and beauty stores in Europe.
It will pay about $5.29 billion in cash and $10 billion in Walgreen stock for the remaining stake, the Deerfield, Illinois-based company said in an Aug. 6 statement. Proceeds of the bond sale may help fund the purchase of the remainder of Alliance Boots and help refinance its borrowings, according to a regulatory filing.