(Bloomberg) -- Occidental Petroleum Corp. is sounding out investors for a bond sale that is expected to total around $5 billion to help fund its takeover of Texas shale driller CrownRock LP.
The potential investment-grade offering could be announced as soon as Tuesday after banks held calls with investors, according to people familiar with the transaction, who asked not to be identified because the discussions are private. The sale is expected to include notes maturing in three, five, seven, 10 and 30 years, the people also said.
A $10 billion bridge facility previously loaned to the company to help fund the acquisition has since been reduced to $5.3 billion, according to a filing. S&P Global Ratings puts the deal at $5 billion, according to a statement.
A representative for Occidental pointed to the July 19 filing and offered no further comment. As for banks running the deal, representatives for Bank of America Corp., Mitsubishi UFJ Financial Group and SMBC Nikko declined to comment while a spokesperson for JPMorgan Chase & Co. didn’t respond to a request for comment.
Occidental agreed in December to buy CrownRock for $10.8 billion, lining up about $10 billion of debt, one of the largest bridge financing deals last year. That temporary loan was led by Bank of America, and is expected to at least partly be replaced by the bond sale. Occidental said it expects to close its purchase of the Texas shale driller next month.
The debt would be the latest financing for a merger to hit the blue-chip debt market this year. In February, pharmaceutical giant AbbVie Inc. sold $15 billion of bonds to help fund its acquisitions of ImmunoGen Inc. and Cerevel Therapeutics Holdings Inc. Just last month, Home Depot Inc. sold $10 billion worth of notes in the US investment-grade market to help finance its acquisition of building-products distributor SRS Distribution Inc.
About $35 billion of US high-grade bond sales are expected this week as more companies emerge from earnings blackout periods.
--With assistance from Maria Clara Cobo and Michael Gambale.
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