PHH to Issue $1B in Notes

PHH Corp., a subsidiary of Cendant Corp. based in Parsippany, N.J., has announced a $1 billion public offering of senior unsecured notes, of which $600 million will be issued as 10-year notes and the remainder as five-year notes.PHH said the proceeds will be used to repay short-term debt. Banc of America Securities LLC and Barclays Capital are the joint book-running managers for the offering, which was assigned a BBB-plus rating and a negative rating outlook by Fitch Ratings. Fitch said it views the offering positively because it extends the maturities of PHH's outstanding debt, but pointed to two offsetting factors: the cyclicality of the mortgage business and the "potential impact of the interest rate environment on mortgage servicing rights."