By Lisa Kerner
Charlotte, N.C., June 3 – Aetna Inc. detailed its sale of $13 billion senior notes in eight tranches (Baa2/A/A-), according to an FWP filed with the Securities and Exchange Commission on Friday.
As previously reported, the company sold $500 million of one-year floating-rate notes at Libor plus 65 basis points, on the tight side of guidance of Libor plus 70 bps, plus or minus 5 bps.
Aetna priced $1 billion of 1.7% two-year notes at 99.92 to yield 1.741%. The notes sold at 85 bps over Treasuries, compared to talk of Treasuries plus 90 bps, plus or minus 5 bps.
The $1.65 billion tranche of 1.9% three-year notes priced at 99.925 to yield 1.926%, with a spread of 90 bps over Treasuries. The notes were talked at Treasuries plus 95 bps, plus or minus 5 bps.
Aetna placed $1.85 billion of 2.4% five-year notes at Treasuries plus 105 bps, on the tight side of talk of Treasuries plus 110 bps, plus or minus 5 bps. The notes priced at 99.99 to yield 2.402%.
The $1.3 billion tranche of 2.8% seven-year notes priced 99.954 to yield 2.823%, or 120 bps over Treasuries. The notes were guided at Treasuries plus 125 bps, plus or minus 5 bps.
Aetna sold $2.8 billion of 3.2% 10-year notes with a spread of 145 bps over Treasuries. The notes were talked to price at Treasuries plus 150 bps, plus or minus 5 bps. The notes priced at 99.626 to yield 3.244%.
The company priced $1.5 billion of 4.25% 20-year notes at 99.585 to yield 4.281%. Aetna placed the notes at 170 bps over Treasuries, on the tight side of talk of Treasuries plus 175 bps, plus or minus 5 bps.
In the final tranche, Aetna priced $2.4 billion of 4.375% 30-year notes at 99.9 to yield 4.381%. The bonds sold at 180 bps over Treasuries. The bonds were guided at 185 bps over Treasuries, plus or minus 5 bps.
The bookrunners were Citigroup Global Markets Inc., UBS Securities LLC, Credit Suisse Securities (USA) LLC, BofA Merrill Lynch, Barclays, MUFG, Mizuho Securities USA Inc., Morgan Stanley & Co. LLC, SunTrust Robinson Humphrey Inc., U.S. Bancorp Investments Inc. and Wells Fargo Securities LLC.
Proceeds will be used to fund a $3.2 billion term loan and the cash portion of the purchase price of the company’s merger with Humana Inc., according to a 424B3 filing with the SEC.
If the merger is not completed, proceeds from the floating-rate notes and two series of fixed-rate notes will be used for general corporate purposes.
Aetna is a diversified health care benefits company based in Hartford, Conn.
| Issuer: | Aetna Inc.
|
| Amount: | $13 billion
|
| Securities: | Senior notes
|
| Bookrunners: | Citigroup Global Markets Inc., UBS Securities LLC, Credit Suisse Securities (USA) LLC, BofA Merrill Lynch, Barclays, MUFG, Mizuho Securities USA Inc., Morgan Stanley & Co. LLC, SunTrust Robinson Humphrey Inc., U.S. Bancorp Investments Inc., Wells Fargo Securities LLC
|
| Co-managers: | PNC Capital Markets LLC, BNY Mellon Capital Markets LLC, HSBC Securities (USA) Inc., Fifth Third Securities Inc.
|
| Trade date: | June 2
|
| Settlement date: | June 9
|
| Ratings: | Moody’s: Baa2
|
| S&P: A
|
| Fitch: A-
|
| Distribution: | SEC registered
|
|
|
| One-year floaters
|
| Amount: | $500 million
|
| Maturity: | Dec. 8, 2017
|
| Coupon: | Libor plus 65 bps
|
| Price: | Par
|
| Yield: | Libor plus 65 bps
|
| Price guidance: | Libor plus 70 bps, plus or minus 5 bps
|
| Make-whole call: | Non-callable
|
|
|
| Two-year notes
|
| Amount: | $1 billion
|
| Maturity: | June 7, 2018
|
| Coupon: | 1.7%
|
| Price: | 99.92
|
| Yield: | 1.741%
|
| Spread: | Treasuries plus 85 bps
|
| Price guidance: | Treasuries plus 90 bps, plus or minus 5 bps
|
| Make-whole call: | Treasuries plus 15 bps
|
|
|
| Three-year notes
|
| Amount: | $1.65 billion
|
| Maturity: | June 7, 2019
|
| Coupon: | 1.9%
|
| Price: | 99.925
|
| Yield: | 1.926%
|
| Spread: | Treasuries plus 90 bps
|
| Price guidance: | Treasuries plus 95 bps, plus or minus 5 bps
|
| Make-whole call: | Treasuries plus 15 bps
|
|
|
| Five-year notes
|
| Amount: | $1.85 billion
|
| Maturity: | June 15, 2021
|
| Coupon: | 2.4%
|
| Price: | 99.99
|
| Yield: | 2.402%
|
| Spread: | Treasuries plus 105 bps
|
| Price guidance: | Treasuries plus 110 bps, plus or minus5 bps
|
| Make-whole call: | Treasuries plus 20 bps prior to May 15, 2021, then callable at par
|
|
|
| Seven-year notes
|
| Amount: | $1.3 billion
|
| Maturity: | June 15, 2023
|
| Coupon: | 2.8%
|
| Price: | 99.854
|
| Yield: | 2.823%
|
| Spread: | Treasuries plus 120 bps
|
| Price guidance: | Treasuries plus 125 bps, plus or minus 5 bps
|
| Make-whole call: | Treasuries plus 20 bps prior to April 15, 2023, then callable at par
|
|
|
| 10-year notes
|
| Amount: | $2.8 billion
|
| Maturity: | June 15, 2026
|
| Coupon: | 3.2%
|
| Price: | 99.626
|
| Yield: | 3.244%
|
| Spread: | Treasuries plus 145 bps
|
| Price guidance: | Treasuries plus 150 bps, plus or minus 5 bps
|
| Make-whole call: | Treasuries plus 25 bps prior to March 15, 2026, then callable at par
|
|
|
| 20-year notes
|
| Amount: | $1.5 billion
|
| Maturity: | June 15, 2036
|
| Coupon: | 4.25%
|
| Price: | 99.585
|
| Yield: | 4.281%
|
| Spread: | Treasuries plus 170 bps
|
| Price guidance: | Treasuries plus 175 bps, plus or minus 5 bps
|
| Make-whole call: | Treasuries plus 30 bps prior to Dec. 15, 2035, then callable at par
|
|
|
| 30-year notes
|
| Amount: | $2.4 billion
|
| Maturity: | June 15, 2046
|
| Coupon: | 4.375%
|
| Price: | 99.9
|
| Yield: | 4.381%
|
| Spread: | Treasuries plus 180 bps
|
| Price guidance: | Treasuries plus 185 bps, plus or minus 5 bps
|
| Make-whole call: | Treasuries plus 30 bps prior to Dec. 15, 2045, then callable at par
|
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