DirecTV (DTV:US) raised $750 million with bonds that may fund share repurchases at the largest U.S. satellite-TV operator, whose stock trades cheaper relative to earnings than its average U.S. competitor.
The company issued 1.75 percent, five-year securities that yield 115 basis points more than similar-maturity Treasuries, according to data compiled by Bloomberg. Proceeds from the sale may be used to buy back stock, El Segundo, California-based DirecTV said today in a regulatory filing.
Of the company’s $17.2 billion of bonds outstanding, no debt had been slated to mature in 2018 before today’s sale, Bloomberg data show. While DirecTV shares have gained (DTV:US) more than 20 percent in the last 12 months, the stock trades at a price- to-earnings multiple of 12.7, less than the 17.4 average among U.S. cable and satellite companies.
The new bonds were rated Baa2 by Moody’s Investors Service and BBB from Standard & Poor’s.
DirecTV had about $2.97 billion of authorized stock repurchases remaining on Sept. 30, according to a quarterly filing. The company spent about $3.9 billion on buybacks in the first nine months of 2012.
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