Three jumbo-sized high-grade bond deals are hitting the U.S. debt markets Tuesday as companies seek to participate in the record-low yield environment.

It's often said that when IBM issues bonds, others follow, knowing that Big Blue has a knack for achieving record-low yields. So perhaps it's no coincidence that within a half-hour of International Business Machines Corp. (IBM) reporting plans to issue three- and seven-year bonds Tuesday morning, Berkshire Hathaway (BRKB) and beverage company Diageo (DEO) each disclosed their own three-part debt issues.

Each is "benchmark"-sized, which typically means at least $500 million per tranche. They could be considerably larger, pending market appetite.

The flurry of jumbo deals comes at a time of record-low yields for highly-rated bonds. The widely-watched Barclays U.S. Investment-Grade Index finished last week at 3.25%, the lowest level in data going back almost four decades. On Monday it ticked up to 3.26%, the second-lowest rate on record.

When IBM last issued three-year bonds in February, it achieved an all-time low coupon of 0.55%, according to Dealogic. Those bonds last traded Monday at a spread over Treasurys of 0.37 percentage point, yielding 0.737%, according to MarketAxess.

IBM's debt is rated Aa3 by Moody's Investors Service and A-plus from Standard & Poor's and Fitch Ratings.

Berkshire and Diageo, each issuing through financing subsidiaries, are both issuing five-, 10-, and 30-year bonds. The Berkshire bonds are rated Aa2 by Moody's and AA-plus by Fitch, while Diageo's bonds are rated A3 by Moody's and A-minus by S&P and Fitch.

Berkshire is raising funds to retire up to $700 million of 4.75% coupon notes due this year and to replace $1 billion of 4% notes that matured last month.

IBM and Diageo are each borrowing for general corporate purposes. According to Standard & Poor's LCD, this is Diageo's first U.S. bond deal since 2010.

Among smaller issues, Penske Truck Leasing Co. (PTL.XX) is readying a $750 million deal of three- and five-year bonds, and Southern Co. unit Georgia Power said it would sell $500 million in a two-part deal. All five deals are expected to price Tuesday.

-By Patrick McGee, Dow Jones Newswires; 212-416-2382; patrick.mcgee@dowjones.com

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