Rakuten Group is seeking to sell a junk-rated dollar bond in the United States at the lowest cost in more than three years, in a sign of increasing investor confidence in the e-commerce firm’s efforts to reverse years of losses.
The online-mall operator is targeting the sale of as much as $550 million of subordinated notes with price talk for the deal at around 8.375%, according to a person with knowledge of the matter. That would be the lowest pricing for a U.S.-currency note from Rakuten since 2021, when the company lost investment-grade status at S&P Global Ratings, according to data compiled by Bloomberg.
Rakuten is a rare issuer in the U.S. high-yield market, upon which it has become increasingly reliant for funding after its mobile network business saddled it with a string of losses and lower credit ratings. The company, which priced $3.8 billion of dollar bonds between January and April, said it plans to use the funds from the current offering to redeem yen notes that have call options late next year.
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