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Buffett's Berkshire Sells $1.5B of Debt

Warren Buffett's Berkshire Hathaway says in an SEC filing today that it plans to sell $1.5 billion of 3-year and 10-year investment-grade notes guaranteed by the company.

The filing indicates the 10-year notes will be at a fixed rate, while the 3-year notes will be both fixed and floating.

UPDATE AT 4:25P ET: The deal is done. Thomson Reuters IFR says the following notes have been sold:

  • $375M in 3-yr floating rate notes at Libor plus 33 basis points
  • $375M in 1.5% 3-year fixed notes at 58 basis points over comparable Treasuries
  • $750M in 10-year 4.25% fixed-rate notes at 95 basis points over comparable Treasuries

UPDATE at 5:50P ET: Berkshire has filed a pricing term sheet with the SEC.

Dow Jones Newswires calls the decision to issue floating-rate securities "interesting" since interest rates are expected to rise, increasing Berkshire's borrowing costs.

Cabot Money Management's Bill Larkin says Berkshire's deal could change expectations for issuing structure. Buffett is "a very smart man, and others could follow suit."

Proceeds will be used to retire floating-rate notes that mature later this month.

Current Berkshire stock prices:

Class B:

Class A:

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