SLM Corp. or Sallie Mae,the largest student-loan company in the country, today began selling $1 billion in senior notes due 2016, according to sources.
Price talk is between 6.5% and 6.625%. Bank of America Merrill Lynch is the lead bookrunner.
The Reston, Virginia-based firm reportedly plans to use the proceeds from the notes to refinance existing debt. The company is taking advantage of its improved stock price, which rose today past 48 cents, the highest level since mid-2008.
The notes may receive a ‘Ba1’ rating from Moody’s Investors Service and a ‘BBB-‘ rating from Standard & Poor’s.
Last March, Sallie Mae issued $1.5 billion in 8% 10-year notes, priced at 98.32 cents on the dollar, according to Bloomberg.
The notes, which tumbled to as low as 86.25 cents in May, traded yesterday at 102.9 cents to yield 7.554%, or a spread of 424.5 basis points.