Walmart Inc. (NYSE: WMT) is selling US dollar bonds for the second time this year while simultaneously sounding out investors for a debut Canadian dollar debt offering.
The retail giant is seeking to raise at least $2.5 billion through a four-tranche US dollar bond offering, with maturities ranging from three to 10 years.
Initial price talk on the longest tenor is a yield premium of 0.75 percentage points over Treasuries, according to people familiar with the matter who asked not to be identified.
Walmart has also asked Bank of America Corp., Bank of Nova Scotia and Toronto-Dominion Bank to hold investor calls on a potential Canadian dollar debt offering.
The company is considering raising at least C$3.5 billion, equivalent to approximately $2.5 billion, in a four-tranche Canadian deal spanning maturities from four to 30 years.
No final decision has been made on the size of the Canadian transaction, the people familiar with the matter added, signaling the plans remain fluid.
The fundraising push comes as Walmart accelerates a multi-year investment program to add new stores, expand e-commerce capabilities and automate certain operations.
Analyst estimates compiled by Bloomberg project the company will spend a record $29 billion next year, while it also faces approximately $3.3 billion in bond maturities in the same period.
With the potential Canadian dollar debut, Walmart follows US technology giants Alphabet Inc. and Amazon.com, which have also tapped the Canadian bond market this year to fund artificial intelligence infrastructure investments.
The Canadian market offers currency and investor diversification for US borrowers, while local investors have actively purchased foreign debt to broaden their sectoral exposure.
The shorter-dated Canadian bonds are being discussed at spreads as much as four basis points wider than comparable bonds of Ontario utility Hydro One Ltd., with the longest maturity expected to price as much as seven points tighter.
Walmart, which typically taps the bond market just once a year, last raised funds in the US in April, when it secured $4.25 billion.
Bloomberg Intelligence analysts Poonam Goyal and Sydney Goodman noted last week that Walmart is positioned to broaden its customer reach and capture more household spending as inflation and higher gas prices squeeze consumer budgets.
BNP Paribas SA is leading the US dollar bond offering, while Bank of America is involved in the Canadian discussions, though both banks either declined to comment or did not immediately respond to requests for comment.
The $940 billion company’s dual-market debt strategy underscores its ambition to diversify funding sources as capital expenditure reaches historic levels in the years ahead.
