Bloomberg News

Eaton Issues $4.9 Billion of Debt to Fund Cooper Industries Deal

November 14, 2012

Eaton Corp. (ETN:US), the equipment maker that is acquiring Cooper Industries Plc (CBE:US), sold $4.9 billion of bonds in five parts to help fund the purchase.

Eaton issued $600 million of 0.95 percent, three-year debentures to yield 65 basis points more than similar-maturity Treasuries, $1 billion of 1.5 percent, five-year notes at a relative yield of 90 basis points, $1.6 billion of 2.75 percent, 10-year securities at 120 basis points, $700 million of 4 percent, 20-year debt at 130 and $1 billion of 4.15 percent, 30- year bonds at 145, according to data compiled by Bloomberg.

The three-year portion was added after the initial offering earlier today, according to a person familiar with the transaction, who asked not to be identified citing lack of authorization to speak publicly.

The company agreed to buy Cooper, a maker of electric- distribution equipment, in May for $11.8 billion. If the purchase is not completed by May 21, 2013, the bonds will be redeemed at 101 cents on the dollar, the company said today in a statement.

The systems manufacturer last sold debt in June 2011, issuing $300 million of floating-rate three-year debentures to yield 33 basis points more than the three-month London interbank offered rate, Bloomberg data show.

The new bonds were issued through Turlock Corp. and are rated Baa1 by Moody’s Investors Service, the ratings company said today in a statement.

Citigroup Inc. and Morgan Stanley managed the sale for the Cleveland-based company, Bloomberg data show.

To contact the reporter on this story: Sarika Gangar in New York at sgangar@bloomberg.net

To contact the editor responsible for this story: Alan Goldstein at agoldstein5@bloomberg.net


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Companies Mentioned

  • ETN
    (Eaton Corp PLC)
    • $66.37 USD
    • -0.19
    • -0.29%
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