Brunswick Corporation Prices Baby Bonds

Brunswick Corporation (NYSE:BC) has priced their new notes with a coupon of 6.375% which is about where we believed they would price based upon the other 2 issues they have outstanding.

The issue is investment grade with S&P at BBB- and Moodys at Baa2. The issue will mature in 2049 and has a optional redemption date starting 4/15/2024.

There will be 8 million shares (bonds) sold in this offering with another 1.2 million available for strong demand.

This issue will not trade on the OTC Grey market as it is a debt issue. The ticker is likely to be BC-C (although it has not been announced). Bonds will likely begin trading in the next 7-10 days.

The pricing term sheet may be read here.

4 thoughts on “Brunswick Corporation Prices Baby Bonds”

  1. Tim, this question is offline, but I’m wondering what strategy you use with preferreds when there is a correction or recession? In the Great Recession of 2007-2009, for example, PFF went from about 22 to a low of around 7 before strongly rebounding. We got a taste of that sort of thing last fall. Term preferreds and short-term baby bonds are an easy decision, but what about the preferred stocks? Do you stay strapped in for the income and ride it out, or instead try to unload a portion of holdings for cash at the early signs of a downturn, even if they’re thinly traded? Forgive me if I have asked about this in the wrong venue, but I hope there will be an opportunity for your views and those of your readers elsewhere. Thanks.

    1. Wilson–I wish I could tell you what I would do–I would hope that I would move to higher quality and buy, buy buy–not necessarily investment grade but higher quality non rated issues. Of course you have to have cash on hand. I actually sold some heading into the market crashing—and then waited too long coming back out of it to start buying more–too little experience.

      That was my 1st experience with big market stress with preferreds and baby bonds since I started buying them exclusively in 2004 or so–like most I was scared shitless. At the time there were a few that bought more and more, but I think it was a minor group of folks. Right at the bottom my younger brother had to transfer a 401k to an IRA and I told HIM to buy like crazy–he did extremely well buying investment grade preferreds down at 8-10.

      Seldom do I hold a bunch of perpetuals–just a few–more apt to hold term preferreds and short maturity baby bonds. But if we had a big crash I would buy decent quality perpetuals aggressively–and likely unload after good gains are realized.

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