Sysco raises $15.65 billion and €1 billion in debt offerings for acquisition

Sysco Corporation (SYY) said on Monday it issued and sold $10.75 billion in USD senior notes, $3.9 billion in USD junior subordinated notes, and €1.0 billion in Euro junior subordinated notes.

Net proceeds from the offerings were approximately $10.64 billion for the senior notes, $3.8 billion for the USD junior subordinated notes, and €0.99 billion for the euro junior subordinated notes, after deducting underwriters discounts and estimated offering expenses.

The company said in a regulatory filing that it intends to use the net proceeds to pay a portion of the cash consideration for the pending acquisition of JRD Unico, Inc. and Warehouse Realty, LLC, along with related fees and expenses. If the acquisition is not consummated, the proceeds will be used to pay for a special mandatory redemption of the notes, excluding certain senior notes.

The USD senior notes offering included seven tranches:

• $1.75 billion of 5.450% senior notes due 2029
• $2.0 billion of 5.600% senior notes due 2031
• $1.5 billion of 5.800% senior notes due 2033
• $2.0 billion of 5.950% senior notes due 2036
• $1.0 billion of 6.400% senior notes due 2046
• $1.75 billion of 6.500% senior notes due 2056
• $750 million of 6.600% senior notes due 2066

The USD junior subordinated notes offering included three series due in 2056:

• $1.5 billion of 7.100% Series A notes with a first reset date of January 6, 2032
• $1.0 billion of 7.250% Series B notes with a first reset date of October 6, 2033
• $1.4 billion of 7.350% Series C notes with a first reset date of October 6, 2036

The Euro junior subordinated notes consist of €1.0 billion of 6.000% notes due October 6, 2056, paying interest annually in arrears.