BMW Finance, a unit of Bayerische Motoren Werke AG, the world's largest maker of luxury cars, plans to sell bonds, according to a banker managing the sale.
BMW Finance hired Bank of America, Credit Suisse Group and Morgan Stanley to organize the sale of $300 million of bonds due May 2012, said the banker, who declined to be identified. The debt will be guaranteed by BMW, the banker said. The bonds will yield 13 to 14 basis points more than the midswaps rate, the banker said. The midswaps rate is a measure of the cost of swapping between fixed and floating-rate payments and a benchmark for corporate borrowing in Europe. A basis point is 0.01%age point. Moody's Investors Service ranks BMW's debt A1, its fifth-highest investment grade ranking, according to data compiled by Bloomberg. Standard & Poor's grades the debt an equivalent A+. (Bloomberg)