UN Unilever NV

By Christopher Whittall 

Consumer-goods giant Unilever NV was set to raise money in bond markets Monday that will cost them almost nothing, in the latest sign of how the European Central Bank's stimulus measures are slashing funding costs across the continent.

In one tranche of a EUR1.5 billion ($1.68 billion) deal, the Anglo-Dutch company was set to sell EUR300 million of debt maturing in 2020 with a coupon of 0%, potentially offering investors a yield of just 0.06%, according to deal guidance released Monday by underwriting banks.

The Unilever bonds will be one of the lowest-yielding euro debt sales on record, and one of the first since the ECB released details on Thursday of its plans to start buying corporate bonds in June.

Borrowing costs for major European corporations have dropped sharply since the ECB said in March it planned to start buying nonbank euro-denominated corporate debt later this year.

Banks handling the Unilever deal have received orders of around EUR4 billion from investors for the debt sale, which also included eight-year and 12-year bonds, according to the deal notice. The eight-year bonds are expected to offer a yield of around 0.66%, while the 12-year bonds are expected to offer a yield of around 1.18%, according to a person familiar with the deal. Both these bonds will have positive coupons.

The bonds will price later Monday. Citigroup Inc., Deutsche Bank AG, HSBC PLC and Banco Santander SA are underwriting the deal.

Write to Christopher Whittall at christopher.whittall@wsj.com

(END) Dow Jones Newswires

April 25, 2016 08:36 ET (12:36 GMT)

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