NEW YORK — IBM Corp. sold $3.9-billion in bonds on Thursday, a sign that the stalwarts of the corporate world are still finding lenders.
“The markets were open to us at this time, so we decided to enter,” said IBM spokesman Doug Shelton. He added that it was an opportunity to cover pending maturities as the company enters the fourth quarter and approaches the new year.
Late Wednesday, the Armonk, N.Y.-based tech company gave Wall Street an early glimpse into its quarterly results, reporting a better-than-expected profit.
Shares of IBM fell $1.55, or 1.7 per cent, to close at $89 on Thursday. That was a smaller drop than the 7.3 per cent decline in the Dow Jones industrial average, which includes IBM, and the 5.3 per cent decrease in the technology-laden Nasdaq composite index.
Still, analysts have expressed concern that IBM could have problems in the fourth quarter and into 2009 if the lending and spending environment deteriorates, as many expect it will.
IBM's bond sale was in three parts: $1.4-billion of five-year notes, $1.5-billion of 10-year notes, and $1-billion of 30-year bonds. Those bonds had rates of 3.875 per cent over treasuries for the five-year and 10-year notes, and 4 per cent over Treasuries for the 30-year bonds.
It was the second major corporate bond sale to go forward since the bankruptcy of Lehman Brothers Holdings Inc. in September. Last month, Caterpillar Inc. issued nearly $1.3-billion in notes with rates of 7.05 per cent and 6.2 per cent.
