(April 3): Berkshire Hathaway Inc has started sounding out investors for a potential multi-tranche yen bond sale, according to people familiar with the matter.
The potential bond sale comes about a week after the disclosure of a plan to invest about ¥300 billion (US$1.8 billion or $2.3 billion) in insurer Tokio Marine Holdings Inc.
The US-based conglomerate looks to sell the bonds across seven tenors, from three to 30 years, and price the deal as early as April 10, said the people, who declined to be identified as the information is confidential. Bloomberg reported Thursday that Mizuho Securities and BofA Securities would be managers of the debt sale.
Berkshire, which saw Greg Abel take over the reins from his legendary predecessor Warren Buffett earlier this year, has been increasing exposure to Japan. Over the past year, it boosted equity positions in Japanese trading firms Itochu Corp, Mitsubishi Corp and Mitsui & Co. In November, it raised ¥210.1 billion from a sale of yen bonds.
Uncertainty surrounding the Iran war has driven volatility in Japanese government bond yields, prompting investors to demand higher risk premiums. Friday, the spread between the 10-year municipal bond and JGBs rose for the first time in 11 months.
Amid this backdrop, corporate issuers have been turning cautious, with only 12 companies pursuing deals as of April 3, down nearly 60% from the same time a year earlier.
See also: Berkshire hires banks for yen bond offering in volatile market
Uploaded by Magessan Varatharaja
