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http://www.businessweek.com/news/2012-12-04/sherwin-williams-plans-750-million-bond-sale-for-comex-purchase

Bloomberg News

Sherwin-Williams Sells $1 Billion of Bonds for Comex Purchase

December 04, 2012

Sherwin-Williams Co. (SHW:US), the paint retailer acquiring Consorcio Comex SA, sold $1 billion of bonds to help fund the purchase.

The company issued $700 million of 1.35 percent, five-year debentures to yield 75 basis points more than similar-maturity Treasuries and $300 million of 4 percent, 30-year securities at a relative yield of 125 basis points, according to data compiled by Bloomberg. The sale was marketed for $750 million earlier today.

Proceeds will also be used to repay borrowings under its domestic commercial paper program, which had about $95 million outstanding yesterday, the Cleveland, Ohio-based company said today in a regulatory filing.

The sale is Sherwin-Williams’s first since December 2009, when it issued $500 million of 3.125 percent, five-year debentures at a spread of 82 basis points, Bloomberg data show. The bonds traded at 104.9 cents on the dollar to yield 0.73 percent on Nov. 27, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

Sherwin-Williams is adding to the company’s 3,500 North American stores after an improving housing market led to record earnings (SHW:US) in the third quarter. Comex, which has exclusive sales to 3,300 paint stores in Mexico, generated 66 percent of its $1.4 billion of revenue last year in Latin America, Sherwin- Williams said in a Nov. 12 presentation.

The new bonds are rated A3 by Moody’s Investors Service, the ratings company said today in a release. Citigroup Inc., JPMorgan Chase & Co. and Wells Fargo & Co. managed the sale, 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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