Sprint Nextel sold $6.5 billion of high-yield bonds on Wednesday, breaking the record for the single biggest noninvestment-grade offering ever sold directly to investors, DealBook’s Michael J. de la Merced reports. The deal shows that investors remain interested in buying up new debt, despite concerns about the Federal Reserve raising rates in the near future.
The Sprint offering surpasses Freeport’s $6 billion junk-bond offering in 2007 and Freescale Semiconductor’s $5.95 billion note sale the previous year, Mr. de la Merced writes. With the sale, Sprint is planning to retire about $3 billion of debt owed by Clearwire, the wireless network operator it agreed to buy earlier this year. “We didn’t wake up thinking we would do the biggest high-yield offering ever,†Joseph J. Euteneuer, Sprint’s chief financial officer, said by phone on Wednesday, adding praise for the performance of its adviser, JPMorgan Chase.
VERIZON’S DEAL FINANCING MOVES QUICKLY  | Verizon Communications’ $130 billion deal to take full control of its wireless unit highlights what bankers describe as the continued health of the debt markets, Mr. de la Merced reports. Even after the deal was announced, the price of Verizon’s bonds moved only a few basis points. And credit ratings agencies quickly announced they were downgrading the company by only one notch, keeping it at investment grade. That is what JPMorgan Chase and Morgan Stanley, the lead banks arranging the $61 billion in financing, had hoped.
“The pace of syndicating the initial bridge loan, provided by the two banks alongside Bank of America and Barclays, to other firms is moving quickly, according to people briefed on the matter. It will eventually be replaced with a $49 billion bond offering and $14 billion worth of loans.â€
RUSSIAN TECH GIANT SELLS FACEBOOK SHARES  | The Russian Internet company Mail.ru, which is owned by the billionaire Alisher Usmanov, announced on Thursday that it had sold its remaining stake in Facebook for around $525 million, more than a year after Facebook’s botched initial public offering, Mark Scott reports in DealBook. The Russian company initially bought its stake in Facebook in 2009 for around $200 million, and has had holdings in a number of other Internet start-ups in the United States.
ON THE AGENDA Â |Â The National Football League season begins Thursday night, with the Baltimore Ravens playing the Denver Broncos in Colorado. Data on factory orders in July is out at 10 a.m. Harvey R. Miller, a prominent bankruptcy lawyer, is on Bloomberg TV at 7 a.m. Thomas J. Curry, the comptroller of the currency, is on Bloomberg TV at 10:10 a.m.
SCHWAB CASE PUTS SPOTLIGHT ON ARBITRATION  | The discount brokerage firm Charles Schwab & Company is finding itself at odds with regulators as it seeks to eliminate the option of class-action lawsuits for its clients, Susan Antilla reports in DealBook. “For Wall Street, the skirmish has inadvertently brought fresh and unwelcome attention to the investor arbitration process and its flaws, and could severely curtail efforts by investors hurt by widespread problems.â€
Investors generally have not been able to use the public court system for their disputes with their stockbrokers since a Supreme Court decision in 1987, but one exception was for issues that were pervasive enough to warrant class-action status. In 2011, though, Schwab added a clause to its customer agreement that required clients to agree not to pursue or participate in class-action suits â€" a move that did not sit well with the Financial Industry Regulatory Authority, Wall Street’s self-regulator. The enforcement division of Finra filed a disciplinary action against Schwab, and now the case is set to go before the association’s adjudicatory panel next Wednesday.
A Bloody Ballmer and the Long Road to a Nokia Deal  | Before Microsoft agreed this week to buy Nokia’s mobile phone and services business for $7.2 billion, the two sides engaged in lengthy, on-and-off talks that often went nowhere, Nick Wingfield reports in the Bits blog. NEW YORK TIMES BITS
Music Executive Starts New Entertainment Business  | Irving Azoff, who resigned last year as Live Nation Entertainment’s executive chairman, announced on Wednesday the creation of Azoff MSG Entertainment, a multifaceted company backed by $175 million from the Madison Square Garden Company. NEW YORK TIMES
Bezos Is a Hit in Visit to Washington Post Newsroom  | Jeffrey P. Bezos, Amazon’s founder who recently agreed to buy The Washington Post, assured newsroom employees on Wednesday that he was committed to preserving quality journalism, The New York Times reports. NEW YORK TIMES
BlackBerry Aims for a Sale by November  | BlackBerry “intends to run a fast auction process that could be wrapped up by November, according to people familiar with the matter,†The Wall Street Journal reports. WALL STREET JOURNAL
Jay Z Said to Be Selling Stake in Nets  | The rapper is selling his small ownership stake in the Brooklyn Nets to Jason Kidd, the team’s coach, according to Page Six. NEW YORK POST
Another Glitch for Nasdaq  | Reuters reports: “Nasdaq OMX Group said the system at the center of the Nasdaq exchange’s three-hour trading halt on Aug. 22 had a six-minute outage on Wednesday for a small number of stock symbols, but the issue had been resolved and trading was not affected.†REUTERS
Rates on Big Mortgages Fall Below Those on Smaller Ones  | Lending executives say the flip has never happened before, The Wall Street Journal reports. WALL STREET JOURNAL
Deutsche Bank Haunted by Concerns Over Capital  | “No one feels like they’ve dealt with the issues yet,†Christopher Wheeler, a London-based banking analyst with Mediobanca, said of Deutsche Bank’s leverage ratio, according to The Wall Street Journal. WALL STREET JOURNAL
Three Managers to Leave Trading Firm  | KCG Holdings, the firm that was formed after Getco took over the Knight Capital Group, said on Wednesday the head of its exchange-traded funds business and two other managers would depart, Reuters reports. REUTERS
Related’s Ross Gives $200 Million to University of Michigan  | The $200 million gift from the real estate developer Stephen M. Ross is the single largest gift in the university’s history. DealBook »
EP Energy, Owned by Apollo, Files for I.P.O. Â |Â The oil and gas company EP Energy was taken private by Apollo Global Management last year. REUTERS
Fund Responds to Chief’s Prostitution Arrest  | Common Sense Investment Management, a $2.9 billion fund of funds based in Oregon, sought to distance itself on Wednesday from a prostitution scandal involving its chief executive. DealBook »
A Rough August for Pershing Square  | Pershing Square Capital Management, the hedge fund run by William A. Ackman, was down 3.6 percent in August, according to Reuters. REUTERS
LinkedIn Raises $1.2 Billion in Stock Offering  | LinkedIn said on Wednesday that it priced the offering of 5.4 million Class A shares at $233 a share. REUTERS
Stock Sale Looks Right for LinkedIn  | Even though LinkedIn does not need the money, its stock sale looks a lot better for shareholders than an overpriced buyback, Robert Cyran writes in Reuters Breakingviews. REUTERS BREAKINGVIEWS
Hearsay Social Raises $30 Million to Give Bankers an Online Presence  | The Silicon Valley start-up â€" and its investors â€" are betting that highly regulated companies will see social media channels as a way to make money. DealBook »
Path Wants to Define Your Inner Circle  | Path, a mobile social network founded by a former Facebook executive, will begin rolling out a software update that allows users to designate an “inner circle†of close friends, the Bits blog reports. NEW YORK TIMES BITS
Start-Up Brings an Internet Sensibility to Time Shares  | The investors in the current round of seed financing include top executives or former executives of Zillow, eHarmony, Expedia, Loopnet and Starwood Capital. DealBook »
Obama’s Favorite in Fed Succession Faces Opposition  | President Obama has long had Lawrence H. Summers, his former economic adviser, in mind to be the next chairman of the Federal Reserve, Jackie Calmes reports in The New York Times. One former administration official said of their relationship, “It’s like the attachment you feel for your heart surgeon after he performs a quadruple bypass.†NEW YORK TIMES
For India’s Central Bank Chief, Honeymoon May Be Short  | Raghuram Rajan, a University of Chicago finance professor who took charge on Wednesday of the Reserve Bank of India, used his initial news conference to announce a long list of financial deregulatory measures. But some of the biggest problems bedeviling the Indian economy are beyond his control, The New York Times writes. NEW YORK TIMES
A Proposal to Strengthen Protections on Customer Funds  | The staff of the Commodity Futures Trading Commission is “expected to recommend as early as this week the agency approve a package of rules, including a provision that could require futures brokers to put aside about twice as much collateral that firms currently must hold, according to people familiar with the matter,†The Wall Street Journal reports. WALL STREET JOURNAL
SAC Capital Said to Increase Bonuses  | Bloomberg News reports: “SAC Capital Advisors, the hedge-fund firm that’s facing federal insider-trading charges and a money-laundering lawsuit, is raising 2014 bonuses for its portfolio managers by 3.5 percentage points to help retain employees, a person with knowledge of the decision.†BLOOMBERG NEWS
GateHouse Media Plans Prepackaged Bankruptcy  | GateHouse Media, backed by the Fortress Investment Group, plans to restructure its $1.2 billion of debt through a Chapter 11 filing. WALL STREET JOURNAL
Bank of England May Pause After Policy Decision  | Reuters reports that the Bank of England is “expected to take a breather†after announcing its latest policy decision on Thursday after “a hectic couple of months†under its new governor, Mark J. Carney, as the economy is showing fresh signs of life. REUTERS
