Exxon pays more to borrow amid market turmoil

Exxon Mobil Corp paid a big premium to raise US$8.5 billion in new debt on Tuesday, as a rout in energy prices and stock market jitters fueled by the coronavirus outbreak eroded investor confidence in the largest U.S. oil producer.

Exxon was among nine major companies that took advantage of a window opening in the U.S. credit markets on Tuesday to issue bonds, after the Federal Reserve announced new measures to boost liquidity in the financial system, including the purchase of short-term corporate debt.Exxon, which is rated Aaa/AA by credit rating agencies, issued its debt at a 60 basis point premium to PepsiCo Inc , which has a lower investment-grade rating of A1/A+.

Saudi Arabia is locked in an oil price war with Russia following the collapse earlier this month of an output deal between OPEC and its allies that has wiped 30per cent off energy prices. Despite the higher cost of the new debt, Exxon will be relieved to have been able to raise the funds, according to Bill Zox, chief investment officer of fixed income at Diamond Hill Capital ManagementExxon did not immediately respond to a request for comment. The company's debt pile totaled US$46.9 billion as of the end of December.

Business Business Latest News, Business Business Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

US markets should stay open despite turmoil, says securities regulatorU.S. markets should stay open despite intense volatility, the head of the U.S. securities regulator said on Monday, quashing industry speculation ...
Source: ChannelNewsAsia - 🏆 6. / 66 Read more »

Virus-hit global financial markets in turmoil; recession odds growVOLATILITY continued to roil global financial markets as investors struggle to adjust to an unprecedented upheaval in social interactions that looks set to plunge the world into recession. Read more at The Business Times.
Source: BusinessTimes - 🏆 15. / 51 Read more »

Surging borrowing costs, vanishing buyers: more pain ahead for European junk bondsBorrowing costs for junk-rated European companies have nearly tripled in less than a month, and with the market for new debt issuance shuttered, ...
Source: ChannelNewsAsia - 🏆 6. / 66 Read more »

Genting Singapore cuts senior management, managerial staff pay by 9-18% amid Covid-19GENTING Singapore on Tuesday announced that it has cut salaries of senior management and managerial staff by 9 to 18 per cent as part of cost control measures amid the Covid-19 pandemic. Read more at The Business Times.
Source: BusinessTimes - 🏆 15. / 51 Read more »