BlackRock Issues $12.55 Billion Meta Data Center Bonds with a Yield of 7.534%

BlockBeats News, July 28, according to Bloomberg, BlackRock issued $12.55 billion in investment-grade bonds for Meta's data center project in El Paso, Texas, which rose in early trading on Monday. The bond issuance yield was 7.534%, 287.5 basis points higher than U.S. Treasuries, a yield level more commonly seen in the junk bond market. During the issuance phase, the subscription scale for the bonds was approximately $20 billion, only 1.6 times the issuance amount, significantly lower than the average subscription level of about 4 times for bond issuances this year. However, the higher yield ultimately attracted investors, and the yield spread in the secondary market narrowed to about 260 basis points above U.S. Treasuries, lower than the 287.5 basis points at issuance. Recently, tech companies have been intensively conducting large-scale bond financing, putting pressure on investors' capacity to absorb new AI-related debt. Tech bonds have previously seen sell-offs, and companies like Alphabet continue to expand capital expenditures and may issue more bonds, further weakening market demand for newly issued bonds. The early performance of BlackRock's bonds contrasts with recent issuances by companies like SpaceX. After SpaceX completed its first investment-grade bond issuance in June, the related bonds fell in the secondary market, leaving investors facing significant paper losses. [Original Link]