HG bonds: Orix returns with 2031 notes at 2.294%; terms

Orix Corp. today completed a $500 million offering of 2.25% 10-year notes due March 9, 2031, at T+88, or 2.294%.

The issue was printed at the firm end of guidance in the T+90 area, and through initial whispers at T+110-115.

Proceeds will be used for general corporate purposes, according to regulatory filings. Of note, the company's next maturity is $500 million of 2.65% notes due on April 13, according to S&P Capital IQ.

Orix last tapped the market in January 2019, when it placed a $500 million public offering of par-priced 4.05% five-year senior notes due Jan. 16, 2024, at T+150.

The Tokyo-based issuer is a financial-services company involved in leasing, life insurance, real estate financing and development, and investment and retail banking, among other things.

Orix's A-/A3/A- ratings profile reflects negative outlooks on all sides.

S&P Global Ratings said its outlook reflects the one-in-three probability that the prolonged impact of the COVID-19 pandemic will weaken the company's asset quality or profitability and lead to a downgrade in the next two years. "The negative outlook also reflects our view that the company's continued overseas expansion will require more foreign currency funding, which may strain its financial profile during market downturns," the agency noted in ratings rationale published on Feb. 21.

Fitch in December 2020 said that the negative outlook reflects the prevailing uncertainty in the global economy arising from the pandemic, and the "associated pressure on the company's asset quality, profitability and capitalisation."

Moody's negative outlook also dates to April 2020, and reflects the headwinds from the COVID-19 pandemic. Terms: