Nissan Raises $8 Billion Through Dollar Bonds Issuance, but Long Road to Recovery By

© Reuters.

By Gina Lee – Yokohama-based Nissan (OTC:) Motor Co., Ltd. (T:) has raised $8 billion via its first non-convertible dollar bond sale in at least two decades.

Nissan’s Tokyo shares were down 0.60% to JPY413.5 ($3.90) by 12:27 AM ET (5:27 AM GMT).

The deal, one of the biggest ever in Asia, saw Nissan split the sale into four parts, with a public euro note reportedly due to debut later in the day. It has already priced JPY70 billion ($659.49 million) worth of notes in its home market in July, as well as securing financial backing from the Development Bank of Japan.

Although it has sufficient liquidity, the fundraising followed Nissan’s decision to further strengthen its finances as the company is undertaking business structural reforms, company spokeswoman Azusa Momose told Bloomberg. Access to a broad base of investors is also important, she said.

The Japanese company’s offering adds to record dollar bond sales from Asian issuers this year. As companies look to load up on cash, a broader recovery in global credit markets has also been boosted by March’s monetary stimulus.

With COVID-19 impacting demand, Nissan has been forced to cut jobs and capacity alongside attempts to revive its aging lineup and improve margins. The company forecasts a JPY470 billion ($4.43 billion) operating loss for the current fiscal year after recording its biggest loss in around 20 years.

The company has seen its reputation take a hit since former chairman Carlos Ghosn’s arrest in 2018, which also saw S&P Global Ratings cut Nissan’s credit score to just one level above junk in July.

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