Occidental Petroleum Corp. sold $13 billion of debt to help fund its pending $38 billion merger with fellow oil and gas producer Anadarko Petroleum Corp., Bloomberg News reported Aug. 6, citing people familiar with the matter.
Occidental issued bonds to fund the merger in 10 parts, according to data compiled by Bloomberg. The longest portion of the offering is a 30-year security that yields 2.25 percentage points more than treasuries, the sources said.
The company had received more than $75 billion in orders for the sale, but order books can overstate actual demand, the report said.
Moody's on Aug. 1 downgraded Occidental's senior unsecured rating to Baa3 from A3 and its short term rating to Prime-3 from Prime-2 with a stable outlook. The move followed Occidental's announcement about a planned debt offering to finance the Anadarko deal.
Bank of America Corp., Citigroup Inc., JPMorgan Chase & Co. and Wells Fargo & Co. managed the bond sale, according to the sources.