Sprint Nextel on Wednesday sold $6.5 billion worth of high-yield bonds, breaking the record for the single biggest noninvestment-grade offering ever sold directly to investors. The sale comes only days after Verizon Communications announced that it has taken out $61 billion in financing to support its mammoth deal to buy full control of its wireless unit.
The sale shows that despite concerns about the Federal Reserve raising rates at some point in the near future, debt investors remain interested in buying up new issuances.
“We didn’t wake up thinking we would do the biggest high-yield offering ever,” Joseph J. Euteneuer, Sprint’s chief financial officer, said in a telephone interview Wednesday, adding praise for the performance of its adviser, JPMorgan Chase & Co.
With the sale, Sprint is planning to retire about $3 billion worth of debt owed by Clearwire, a wireless network operator that the phone company agreed to buy earlier this year.
During a call with more than 100 investors Wednesday, Euteneuer outlined Sprint’s capital-expenditure plans, including about $8 billion in 2014.
He also spoke of the operating improvements that Sprint has undertaken, especially since agreeing to sell a majority stake to SoftBank of Japan.