Walmart to buy back $8 billion of corporate debt, issue $2 billion in green bonds

Walmart said Wednesday (Sept. 8) it planned to buy back $8 billion of its bonds ranging from notes due from 2023 through 2049. The tender offer was made public in an filing with the U.S. Securities and Exchange Commission and will run through Oct. 5.

Investors holding impacted notes can tender their bonds for $1,000 principal amount, with no premium paid over face value. Walmart is paying an early tender premium of $50 per $1,000 principle amount for bonds tendered and accepted by Walmart by Sept. 21.  Investors can get full details with the prospectus issued by the company Sept. 8.

Walmart said the rationale behind this large tender offer is to reduce its overall interest expense. The retail behemoth had a total debt of roughly $60.88 billion as of July 31. Total assets totaled $252.5 billion at the same time.

Walmart also plans to issue its first green bonds as a statement to its sustainability commitment. The retailer announced plans of a $2 billion, five-part bond sale which could help fund a range of green projects including solar and wind, energy efficient refrigeration, electric vehicles and waste reduction, according to its green financing framework. Walmart has a target of achieving zero emissions by 2040 and also aims for a 1 billion metric ton cut in emissions from its supply chain by 2030.

New issuance of green, social, sustainability and sustainability-linked bonds from corporations and governments worldwide is at a record $691 billion so far this year, according to data compiled by Bloomberg. Bankers expect the sales to reach $1 trillion for the first time this year.

Citigroup, Mizuho Financial Group Inc. and Wells Fargo & Co. are among banks managing the sale, which will also fund a tender offer for up to $8 billion of bonds. Bank of America Corp. is green structuring agent for the sustainable portion of the sale. Terms of the green bonds have not yet been made public.