Verizon Prices $3.75B Junior Subordinated Notes Offering Across Two Tranches
VZ sits 22% above its 52-week low of $38.39.
Summary
Verizon priced a $3.75 billion two-tranche junior subordinated notes offering, adding to its recent capital-raising activity and providing funds for general corporate purposes, including debt repayment.
Key Events · Financing and Capital Events · VZ
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$3.75B Junior Subordinated Notes Priced
Verizon priced $2.0 billion of 6.600% notes due 2059 and $1.75 billion of 6.750% notes due 2057, both at 100% of par. Settlement is August 13, 2026.
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Proceeds and Use
Net proceeds to Verizon are 99.150% before expenses, totaling approximately $3.72 billion. Funds are earmarked for general corporate purposes, which may include repaying outstanding debt.
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Subordinated Ranking and Deferral Option
The notes rank junior to all senior indebtedness and pari passu with existing junior subordinated notes. Verizon can optionally defer interest payments for up to 10 consecutive years per deferral period.
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Complex Reset and Step-Up Features
Both tranches have fixed-to-fixed rate structures with reset dates and step-ups. The 2059 notes reset in 2034 and step up 0.25% in 2039 and an additional 1.00% in 2054. The 2057 notes reset and step up 0.25% in 2037.
Analysis · VZ · Technology
Verizon is raising $3.75 billion through two junior subordinated notes with rates of 6.600% and 6.750%. The notes are deeply subordinated, rank junior to all senior debt, and allow Verizon to defer interest for up to 10 years — features that provide financial flexibility but come at a higher cost. Proceeds are for general corporate purposes, including debt repayment, which aligns with the company's ongoing cost-cutting and capital management efforts. The offering follows a $4 billion junior subordinated notes issuance in May 2026 and comes amid a backdrop of layoffs, a Dow Jones removal, and a major joint venture. While dilutive to existing bondholders in terms of subordination, the capital strengthens liquidity and extends the maturity profile.
At the time of this filing, VZ was trading at $46.95 on NYSE in the Technology sector, with a market capitalization of approximately $195.4B. The 52-week trading range was $38.39 to $51.68. This filing was assessed with neutral market sentiment and an importance score of 7 out of 10.