Uber borrowing US$500M in junk market's refinancing frenzy
by Molly SmithUber Technologies Inc. is borrowing US$500 million to refinance debt, joining a barrage of high-yield companies that are capitalizing on cheap rates to lower their interest expense.
The ride-sharing service is selling bonds due in 2028 to redeem an equal amount of 7.5 per cent notes due in 2023, according to a statement Monday. It will also use cash on hand for the redemption.
Uber is taking advantage of some of the lowest-ever yields to refinance outstanding obligations. That’s made up the bulk of this year’s borrowing activity, as junk bond issuance has vaulted over US$300 billion for the first time since 2013 and the market is within striking distance of a new annual record.
Morgan Stanley, Bank of America Corp., Barclays Plc, Citigroup Inc. and Goldman Sachs Group Inc. are managing the bond sale, according to a person with knowledge of the matter. The offering is expected to price Monday, the person said, asking not to be identified as the details are private.