NBC Universal plans debt to pay for sale to Comcast

NBC Universal Inc. plans to sell $5.1 billion of debt to help pay for its majority purchase by Comcast Corp., according to a person familiar with the offering, in what would be the third-biggest US debt issue this year. General Electric Co’s NBC Universal is selling the notes to raise part of the $9.1bn it must contribute toward the deal, Fairfield, Connecticut-based GE said today in a statement, which didn’t specify the size or timing of the offering.

The media company is selling the bonds as investment-grade corporate borrowing costs hover near the lowest on record. The planned $28bn combination would give Comcast, the largest US cable company, control of NBC Universal’s TV network and broadcast stations, as well as cable channels such as USA Network and Bravo. “It’s no surprise that NBC can tap the market for that size when I think about the deals we’ve been seeing,” said Timothy Cox, an executive director of debt capital markets at Mizuho Securities USA in New York. “Buyers have a ton of money to put to work and they’re looking for spread.” The four-part offering comprises $900 million of notes due in 2014 that may pay 145 basis points more than similar-maturity Treasuries and $1bn of debt due in 2016 that may pay a spread of 160 basis points, said the person who declined to be identified as terms aren’t set.