BAT to Sell Debt, Buy Back $2.2 Billion of Notes to Cut Risk

British American Tobacco Plc plans to sell new bonds next week as part of a plan to reduce its refinancing risk by repurchasing as much as 1.75 billion euros ($2.2 billion) of debt due in 2011 and 2012, the company said.

BAT, Europe’s second-largest cigarette maker, is offering to tender 750 million euros of 3.625 percent notes due in 2012 and 1 billion euros of 4.375 percent debt due in 2011, according to two statements released today. The tenders will close next week, when the company plans to issue new bonds in euros and possibly pounds to fund the offers, said Neil Wadey, deputy group treasurer at London-based BAT.

The company is refinancing “at rates that they find attractive at this moment,” Wadey said in a telephone interview.

BNP Paribas, Deutsche Bank AG, HSBC Holdings Plc, JPMorgan Chase & Co. and Lloyds TSB Bank Plc are managing the offerings, according to the statements. BNP will purchase the 2011 notes for BAT and sell them back to the company, according to Wadey.


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