General Motors Acceptance Corporation (GMAC), the finance arm of auto giant General Motors Corporation, plans to sell at least $3 billion of global notes, an official for co-lead manager Merrill Lynch & Co. said on Feb. 21, according to Reuters.
The sale is expected to include a $1 billion add-on to GMAC's existing issue of 6.75 percent notes maturing in January 2006, and at least $2 billion of new 10-year notes, Reuters said.
The add-on is expected to yield about 1.875 percentage points more than similar maturity U.S. Treasuries, and the 10-year notes about 2.15 percentage points more than Treasuries.
GMAC opened the five-year issue on Jan. 4 with a sale of $2.75 billion of notes yielding 6.851 percent, or 2 percentage points more than Treasuries. Its parent sold $1 billion of 10-year global notes in that sale.
Bear Stearns & Co. and J.P. Morgan Securities Inc. are also arranging the sale, which is expected Feb. 22 or 23, according to the Reuters report.
Credit rating agency Moody's Investors Service rates GMAC's senior debt "A2," its sixth-highest investment grade, while another rating agency, Standard & Poor's, rates it a roughly equivalent "A."