Hasbro limits bond sale to $350M

PAWTUCKET – Hasbro Inc. (NYSE: HAS) trimmed its planned $600 million debt sale to $350 million, as the global credit crunch and investor concerns about Chinese-made toys weakened demand for the toymaker’s debt offering, Bloomberg News reported. The bond sale – the company’s first since 2000 – was to have been divided between 10-year and 30-year bonds. Instead, Hasbro offered only the 10-year bonds.
Their yield to investors was 6.3 percent, a premium of 200 basis points above the yield on 10-year U.S. Treasuries, Bloomberg found. By comparison, when Hasbro sold similar bonds nine years ago, it paid a yield premium of only 70 basis points.
The toy-safety probe announced by Congress after rival toymaker Mattel Inc. said Chinese-made toys may contain unsafe levels of lead has spurred investor anxiety about Hasbro, which has all its toys made in China. Still, Ira Jersey, credit strategist at Credit Suisse Group in New York, told Bloomberg News: “These are the times when sometimes little guy gets squeezed out, but they were still able to get funding.”
The sale was managed by Bank of America Corp. and Citigroup Inc. Hasbro will use the proceeds to pay down its higher-rate revolving credit line, it told the U.S. Securities and Exchange Commission in a regulatory filing before the sale.
Hasbro Inc. (NYSE: HAS) is a world leader in the design, manufacture and marketing of traditional and high-tech games and toys under brands including Playskool, Tonka, Milton Bradley, Parker Brothers, Tiger and Wizards of the Coast. Additional information is available at www.hasbro.com.