Rakuten launches upsized $2 billion 9¾% five-year bullet at 99.512 to yield 9 7/8% with huge book

By Paul A. Harris

Portland, Ore., April 3 – Rakuten Group Inc. launched an upsized $2 billion amount of five-year bullet notes (BB) with a 9¾% coupon at an original issue discount of 99.512 to yield 9 7/8% on Wednesday morning, according to market sources.

A blowout deal, it upsized from its announced $1.25 billion amount, at which size it was talked to yield in the 10% area (initial guidance was in the mid-10% area), a trader recounted.

At its initial size and official talk in the 10% area Rakuten’s new notes offer was playing to a whopping $11.3 billion of demand, the trader said.

Final terms are expected by midday Wednesday.

Goldman Sachs & Co. LLC is lead left bookrunner for the Rule 144A and Regulation S for life offering.

Morgan Stanley & Co. LLC, Daiwa Capital Markets, Mizuho Securities USA Inc., SMBC Nikko Securities America Inc., ING Financial Markets LLC, BofA Securities Inc., Citigroup Global Markets Inc. and Nomura Securities International Inc. are also bookrunners.

Proceeds will be used to fund the redemption or repurchase of the company’s senior notes due in 2024 or later.

Rakuten is a Tokyo-based technology conglomerate.

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