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Terumo plans ¥100B bond offering, one of Japan's biggest of the year

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Terumo, Japan's largest medical device maker, will soon offer bonds worth ¥100 billion ($857 million), which would be the country's largest bond offering since May, when two other Japanese companies raised that amount, Bloomberg reports.

On sale will be ¥50 billion ($428.9 million) of 5-year and 7-year notes. The financing will help offset the maturation of ¥40 billion ($343.1 million) of three-year notes, said Bloomberg, citing a regulatory filing with Japan's Finance Ministry. Terumo plans to use the proceeds to pay down debt and cover cost reduction expenses.

The company makes a variety of products, including catheters, syringes, guidewires, monitoring systems and platelet concentration systems. Terumo recently cut its annual net income forecast by 11% to ¥33.5 billion ($287 million) for the year ending March 2015, Bloomberg reports.

The bond offering comes amid a recessionary Japanese economy. In fact, Prime Minister Shinzo Abe said today that he wants to dissolve parliament and hold a surprise election next month as he seeks affirmation of "Abenomics" to save the faltering economy. It consists of three "arrows": expansionary monetary policy, fiscal stimulus and structural reforms. Many hope Abe will make concessions to enable Japan to join the Trans-Pacific Partnership free-trade agreement as part of the third arrow. The trade deal is supported by the U.S. medical device industry.

Abe also wants to delay a planned increase in the national sales tax after the first increase helped send the country back into recession.

In other bond-offering news, Medtronic ($MDT) plans a sale of $10 billion or more in bonds to help it finance the $43 billion acquisition of Covidien, as American companies rush to secure today's low interest rates of around 3.5% for 10-year notes. The sale could turn out to be the largest corporate bond offering of the year in the U.S., says The Wall Street Journal.

- read the Bloomberg article
- here's the WSJ on Medtronic's bond offering
- get more about Shinzo Abe and the Japanese economy

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