BMW taps German debt market as coronavirus batters auto industry
Bayerische Motoren Werke AG sold a 200 million-euro ($220 million) deal in the German Schuldschein debt market even as coronavirus upheavals weigh on the global auto industry.
The private five-year sale was bought by only one or two investors, and it priced at as much as 150 basis points over mid-swaps, according to people familiar with the matter, who asked not to be identified because they’re not authorized to speak about it. Bayerische Landesbank led the deal, which closed last week.
BMW’s return to the Schuldschein market came as the spread of the coronavirus damps the global economy and hammers auto demand. The Munich-based automaker is preparing to idle its biggest factory -- in South Carolina --- from April 3.
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The Schuldschein is for general corporate purposes, the automaker said in an emailed response to Bloomberg News questions. Its financial and liquidity status is stable with no major changes versus the end of last year.
The company has “no intention to draw" on its 8-billion euro revolver facility, which is due in July 2023.
Other global automakers including Daimler AG, Ford Motor Co., General Motors Co., and Toyota Motor Corp. have tapped banks to shore up finances during the health crisis. The companies have either drawn multi-billion revolving facilities or sought new credit lines.