Berkshire Hathaway sold ?210.1 billion ($1.4 billion) of yen-denominated bonds on Friday at a spread which was lower compared with its previous deal as global investors flock to Japan.
The offering comprised four tranches of SEC-registered, senior, unsecured bonds with maturities ranging from three to 15 years, and raised in aggregate more than the previous ?90 billion sale in April. That prior deal, which came at a time of heightened uncertainty due to US trade tensions, marked the smallest yen issuance by veteran investor Warren Buffett¡¯s firm since it first starting tapping the market in 2019.
The three-year notes, the largest portion of today¡¯s sale, were priced at a spread of 48 basis points over TONA-based yen mid-swaps, compared with 70 basis points in the previous offering. The US firm also paid about 64 basis points on the five-year tenor, lower than the previous offering.
Demand from investors focused on corporate bonds has been recovering, said Takashi Fujiwara, chief fund manager at Resona Asset Management.
He added that Berkshire is a popular name, saying its ¡°credit rating is solid, and foreign investors are also active buyers in the secondary market.¡± Rising interest rates have renewed appetite for corporate debt, he said, adding ¡°Investors see better value and yen-denominated bonds are in their scope.¡±
The deal comes after foreign issuers such as Renault, Slovenia and Shinhan Bank sold samurai bonds this month, highlighting growth in investor appetite although interest was focused on shorter tenors in a rising rate environment.
The tighter spread also underscores an improvement in market sentiment since April, when US tariff threats fueled volatility and prompted several Japanese companies to cancel or delay domestic bond sales over concerns about rising borrowing costs. At the time, uncertainty around trade policy kept investors on edge.
The Omaha, Nebraska-based firm has been a regular issuer of yen bonds since its debut six years ago, making it the largest foreign issuer of yen notes in that period. The latest deal is fueling speculation the company may increase its investment in Japanese stocks.
The US investment company holds stakes in Japan¡¯s five major trading houses, including Mitsubishi and Itochu. Berkshire¡¯s yen fundraising has drawn close attention from investors, amid speculation that proceeds may be used to increase its shareholdings in these firms.
Buffett has expressed his growing admiration for the trading houses in past letters to shareholders.
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