Ford Motor Credit, Berkshire Hathaway, Entergy Texas price deals; Duke Energy Ohio on tap

By Devika Patel

Knoxville, Tenn., Jan. 3 – Thursday morning brought announcements of four new deals in the investment-grade bond primary market, and by the time the markets closed, three of the new deals had priced.

Ford Motor Credit Co. LLC, financing arm of Dearborn, Mich.-based automaker Ford Motor Co., priced $2.75 billion of notes in four parts, and Omaha-based Berkshire Hathaway Finance Corp. sold $1.25 billion of 30-year 4.25% notes (Aa2/AA/).

Beaumont, Texas-based energy provider Entergy Texas Inc. issued $700 million of first mortgage bonds (Baa1/A/) in two parts, and Charlotte, N.C.-based Duke Energy Corp. subsidiary Duke Energy Ohio, Inc. plans to sell 10-year and 30-year first mortgage bonds in two tranches.

Ford sells $2.75 billion

Ford Motor Credit sold $2.75 billion of senior notes in four parts.

A $325 million tranche of two-year floating-rate notes priced at par. The interest rate will be equal to Libor plus 255 basis points.

A $350 million three-year floating-rate note sold at par. The interest rate will be equal to Libor plus 314 bps.

Ford also sold $675 million of two-year 5.085% notes that priced at par, or a 270 bps spread above Treasuries.

A $1.4 billion three-year 5.596% note sold at par with a 325 bps spread above Treasuries.

BNP Paribas Securities Corp., Deutsche Bank Securities Inc., Mizuho Securities USA Inc., Morgan Stanley & Co. LLC, Goldman Sachs & Co. LLC, NatWest Markets Securities Inc. and RBC Capital Markets LLC were the bookrunners.

Proceeds will be used to purchase receivables, for loans and for use in connection with the retirement of debt.

Berkshire brings $1.25 billion

Berkshire Hathaway Finance priced $1.25 billion of 30-year 4.25% senior notes.

The notes priced at 98.978 to yield 4.311% with a spread of Treasuries plus 140 bps.

The notes will be guaranteed by parent company Berkshire Hathaway Inc.

BofA Merrill Lynch, Goldman Sachs, J.P. Morgan Securities LLC and Wells Fargo Securities LLC are the bookrunners.

Proceeds will be used to refinance the company's $950 million of floating-rate senior notes due Jan. 11, 2019, to repay intercompany debt and for general corporate purposes.

Entergy sells $700 million

Entergy Texas issued $700 million of first mortgage bonds in two parts.

The company sold $300 million of 4% notes due March 30, 2029 at 99.814 to yield 4.023% with a spread of 145 bps over Treasuries.

Entergy Texas priced $400 million of 4.5% notes due March 30, 2039 at 160 bps over Treasuries. These notes were priced at 99.73 to yield 4.521%.

BNP Paribas, KeyBanc Capital Markets Inc., Mizuho, MUFG and Scotia Capital (USA) Inc. were the bookrunners.

Proceeds will be used to repay at maturity the company’s $500 million of 7.125% first mortgage bonds due Feb. 1, 2019 and for general corporate purposes.

Duke Energy Ohio eyes offering

Duke Energy Ohio plans to sell first mortgage bonds in two tranches. The notes are due on Feb. 1, 2029 and Feb. 1, 2049.

The 2029 notes feature a make-whole call until Nov. 1, 2028 and then a par call. The 2049 notes feature a make-whole call until Aug. 1, 2048 and then a par call.

Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Goldman Sachs and U.S. Bancorp Investments Inc. are the bookrunners.

Proceeds will be used to repay at maturity $450 million of the company’s 5.45% first mortgage bonds due April 1, 2019, to pay down some commercial paper and for general corporate purposes.

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