Bayer takes advantage of low interest rates, issuing 2 billion euros of bonds

German pharma and life sciences group Bayer (BAYN: DE) says it is taking advantage of currently low interest rates to raise debt capital on favorable terms.

The company revealed that it had successfully issued three Eurobonds with a combined volume of 2 billion euros ($2.7 billion). The proceeds will be used for general corporate purposes and possible acquisitions, though Bayer gave no indication of any plans.

All the tranches were placed on attractive terms. The 500 million-euro two-year floating-rate Eurobond was issued at an interest rate of 22 basis points over three-month Euribor. The 750 million-euro four-year fixed-rate Eurobond carries a coupon of 1.125%, and the 750 million-euro seven-year fixed-rate Eurobond carries a coupon of 1.875%. The issuances met with exceptionally high demand on the capital market and the order book was over four times oversubscribed.

Werner Baumann, chief financial officer of Bayer AG, said: “The successful placement of these benchmark bonds confirms Bayer’s high standing on the capital market. We have used our strong position as an issuer and the positive market environment to improve our debt and liquidity structure.”

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