Despite recent asset disposals, Prologis is selling dollar-denominated bonds with record-high yields, highlighting continued investor concerns about the company’s financial health. The initial price guidance for the company’s three-year notes is approximately 10.375%, and Fitch has a rating of ‘BB’. This yield is significantly higher than the 2021 dollar perpetual bond’s coupon of 4.6%.
Industry analysts note that the double-digit opening price guidance suggests Prologis may look somewhat doomed. The company expects to complete a major asset disposal by mid-2025, and its relatively high interest rate on three-year notes could continue to focus attention on the company’s current liquidity and funding channels. There is sex.
Earlier this month, Prologis announced plans to repurchase existing bonds due June 2025, amounting to $1 billion in principal. The company said the tender offer is aimed at taking control of its bonds that are nearing maturity. Prologis has sufficient liquidity to repay its bonds due in 2025 without issuing new debt, according to a Fitch report this month.
As of Monday morning, Prologis’ $1 billion of 3.875% coupon bonds scheduled for repurchase had an 8.2% yield to maturity, based on data compiled. A perpetual bond with a 4.5% coupon yields about 12%.
