Brunswick Corporation to Sell More Baby Bonds

Once again Brunswick Corporation (NYSE:BC) is entering the marketplace to sell baby bonds. The bond will mature in 2049.

Being debt there will likely be no OTC Grey market trading.

The company has 2 other outstanding issues of baby bonds, both of which are investment grade.

BC-A is a 6.50% coupon issue which matures in 2048 and is trading around $25.45, while BC-B, which carries a 6.625% coupon, and matures in 2049 is trading around $25.80.

I expect this new bond will price between 6.375% and 6.5%.

Preliminary documents can be read here.

3 thoughts on “Brunswick Corporation to Sell More Baby Bonds”

  1. I own BC-B. I sold BC-A when BC-B was issued. Not pleased with another offering but I agree, do not expect it to pay about BC-B. No need to pay that high in this market. I am traveling with mostly my smartphone so I have limited access. If memory serves me correctly it is BAA2 rated.

    1. Tim, thanks so much for very early alert. At this juncture, the new BC note is almost God sent IMHO. In scary times, I bought BC-A. Then I sold BC-A and bought BC-B, ended up with 399 shares. I sold some of my legacy lower coupon of CLNY (Colony Capital) 7.125% coupon and get rid to buy the new BC note. On my daughter’s IRA account, I bought her some PEGI, wind energy with pro forma yield 8%. PEGI along with ARCC are the two “correct” plays of Rida Morwa et. al. IMHO. I looked at AHT, highly leveraged hotel. Seems that the preferreds follow the commons. The nice thing about making mistakes on preferreds. With legacy positions bought at IPO when CLNY was doing okay, the dividends received offset the huge cap loss. End up opportunity cost as long as they do not file for bankruptcy. I have lots of CLNY-G, 7.5%. Can sell these with more offset on the dividends. Always best to get rid of the low coupon ones first.
      I looked at Rida’s BRX and find it difficult to buy more at $20 range, knowing that BRP partnership is offering more shares between $19 to $21 and it seems too late to buy your BPRAP the preferred. So I bought small number of BEP, sun renewable with pro forma yield of 6.7% and better balance sheet than PEGI and 2.5 x the market cap.

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