Starwood Hotels & Resorts Worldwide Inc., which is selling assets and cutting interest costs to protect its investment-grade rating as it faces slowing demand for lodging, is already getting an upgrade in the bond market.
The company’s bonds yield 151 basis points, or 1.51 percentage points, more than similar-maturity Treasuries, closer to the 126 basis-point spread on debt rated A than the 209 basis points on its own BBB category. Starwood, which operates the W chain of luxury hotels, sold $350 million of 3.125 percent, 10- year bonds this month and will use the money together with some its $650 million in cash to retire $559.2 million of debt with coupons at least twice as high.
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