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Kroger (KR.US) began issuing dollar bonds to finance the acquisition of Albertsons (ACI.US).

AInvestTuesday, Aug 20, 2024 9:30 am ET
1min read

Kroger (KR.US) is set to raise funds to buy rival Albertsons (ACI.US) in the U.S. investment-grade bond market on Tuesday, potentially one of the largest corporate bond deals of the year. The supermarket chain is planning to sell bonds in seven tranches, with a total size of about $10 billion, according to people familiar with the matter. The longest-dated bonds, with a 40-year maturity, may yield about 1.9 percentage points more than U.S. Treasuries, the people said.

The size of the deal will be announced on Tuesday evening, followed by the pricing.

Kroger agreed to buy Albertsons in October 2022 for $24.6 billion. Whether the supermarket chain can buy a smaller rival remains in question.

In February, the U.S. Federal Trade Commission, eight states and the District of Columbia challenged the merger and sued to block the largest supermarket merger in U.S. history. On Monday, Kroger said the FTC had violated the separation of powers in the U.S. Constitution by bringing the case before its internal administrative law judges.

Documents show that Citigroup and Wells Fargo arranged an investor call on Monday and are managing the bond sale.

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