7-Eleven Kicks Off Mega Bond Sale to Help Finance Speedway Purchase

(Bloomberg) -- 7-Eleven Inc. is marketing a potential $10.95 billion bond offering, according to people familiar with the matter, in what would be the largest corporate dollar debt sale globally so far this year.

Proceeds would help finance Tokyo-based parent Seven & i Holdings Co.’s $21 billion acquisition of Speedway gas stations in the U.S. from Marathon Petroleum Corp., according to a company spokesman.

A $10.95 billion issuance would be the largest in the corporate dollar bond market globally since a $12 billion sale from Verizon Communications Inc. in November, data compiled by Bloomberg show. It would also add to the 350 billion yen ($3.4 billion) that the convenience-store operator raised in a Japanese debt offering for the Speedway deal two months ago.

The new eight-part deal includes a 30-year tranche which is being marketed at about 135 basis points over Treasuries.

To read more about initial price talk on each tranche of the new 7-Eleven deal

The proposed investment-grade notes were rated Baa2 by Moody’s Investors Service and AA- by S&P Global Ratings. Moody’s this month downgraded 7-Eleven’s issuer rating to Baa2 from Baa1, citing a potential increase in debt after the Speedway purchase. S&P said it’s likely to lower 7-Eleven’s, as well as parent Seven & i’s credit ratings by as many as two notches because of added debt due to the acquisition.

Credit Suisse Group AG, Sumitomo Mitsui Banking Corp., BofA Securities, Citigroup Inc. and JPMorgan Chase & Co. are managing the bond sale.

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