GM borrowing $4 billion of subprime/junk debt today

[AlexB]

General Motors Co. is selling $4 billion of bonds in its latest move to shore up liquidity in the pandemic.


The automaker is offering junk-like yields on a three-part sale in an effort to maintain investment-grade ratings. The longest portion, a seven-year security, will yield 6.35 percentage points above Treasuries, after initially discussing around 7 percentage points, the person said, asking not to be identified as the details are private.


GM is barely hanging onto its investment-grade ratings as shutdowns plague the auto industry, and travel more broadly. Fitch Ratings downgraded GM to one notch to BBB- with a stable outlook Thursday, noting that while the company’s credit profile will remain weak in the shutdown, it should be able to avoid junk status once the worst of the pandemic has passed. It’s also rated one step above speculative grade at Moody’s Investors Service.

GM Sells $4 Billion of Junk-Like Bonds to Keep High-Grade Status

General Motors Co. sold $4 billion of bonds in its latest move to shore up liquidity in the pandemic.

www.bloomberg.com