Dasny, Public Gas Partners postpone bond sales as market hits rocky patch; Wisconsin brings $100 million

By Sheri Kasprzak

New York, Nov. 25 - Soured market conditions and a short holiday week have led some issuers to bail out of planned offerings this week and hold off until after the Thanksgiving turkey has been polished off.

At least four sales planned for pricing Tuesday were postponed until after the Thanksgiving holiday - and most issuers pointed right at lackluster market conditions for the delays.

The Dormitory Authority of the State of New York had been slated to sell $668.5 million in mental health services facilities improvement bonds (/AA-/A+) on Tuesday, but that sale won't take place until early next week, according to Charles Heritage with Dasny's public finance office.

The exact pricing date has not been set.

The sale includes $595.22 million in series 2008F bonds and $73.28 million in series 2008G bonds.

J.P. Morgan Securities Inc. is the lead manager for the negotiated deal.

Proceeds will be used to refund outstanding bonds.

Public Gas sale delayed

Also put on the back burner Tuesday were $225.97 million in munis from Public Gas Partners of Georgia. That offering was put on day-to-day status because of poor market conditions, said Susan Reeves, Public Gas Partners' president.

"The PGP issue has been delayed due to overall poor municipal market conditions this week," Reeves told Prospect News.

"This issue is day-to-day as we watch market conditions after the holiday."

The company had planned to sell $165.86 million in gas project revenue bonds (A2/A/A) for Gas Supply Pool No. 1 and $60.11 million in gas project revenue bonds (A2/A+/A+) for Gas Supply Pool No. 2 on Tuesday.

Both bonds were being sold through lead managers J.P. Morgan Securities and Wachovia Bank.

The Gas Supply Pool No. 1 sale includes $110.36 million in series 2008A tax-exempt bonds and $55.5 million in series 2008B taxable bonds. The 2008A bonds are due 2011 to 2018 with a term bond due 2022. The 2008B bonds are due 2022.

The Gas Supply Pool No. 2 sale includes $39.905 million in series 2008A tax-exempt bonds and $20.205 million in series 2008B taxable bonds. The 2008A bonds are due 2011 to 2018 with a term bond due 2022. The 2008B bonds are due 2022.

Proceeds from both sales will be used to repay lines of credit used to acquire the respective gas supply pools.

Rhode Island sale put off

In other news, the State of Rhode Island and Providence Plantations delayed the sale of its $107.41 million in series 2008 general obligation bonds until early next week, said Mark Dingley, chief legal counsel for the state treasurer's office Tuesday.

"We did not go to market earlier this week as we needed to wait for the rating agencies," Dingley told Prospect News.

"We have now heard from all three agencies - all kept ratings intact - and we hope to do a retail offering next Monday and institutional on Tuesday. The bonds will be priced at that time."

The offering includes $86.875 million in series 2008B consolidated capital development loan bonds, $8.5 million in series 2008C capital development loan bonds and $12.035 million in series 2008D consolidated capital development loan refunding bonds.

The 2008B bonds are due 2010 to 2023 with a term bond due 2028. The 2008C bonds are due 2010 to 2018, and the 2008D bonds are due 2011 to 2018.

Proceeds will be used to refund all outstanding series 2000B bonds.

Arlington still in bond talks

Late Tuesday, Jesselene Kidwell of Arlington, Texas's financial and management resources department, said the city was still in talks about the pricing details of its $169.98 million in series 2008 special tax revenue bonds (Aaa/AAA/).

The bonds were set to price on Tuesday, but Kidwell said there was no guarantee the terms would be available by the close of market.

J.P. Morgan Securities is the lead manager for the offering.

The bonds are due 2017 to 2020 with term bonds due 2027 and 2031.

Proceeds will be used for construction, planning, acquisition and development on the city's Dallas Cowboys Complex.

Wisconsin sells clean water bonds

Moving to what did price Tuesday, the State of Wisconsin brought $100 million in series 2008-3 clean water revenue bonds, said David Erdman with the state's Department of Administration.

The bonds were sold through lead manager Morgan Stanley.

The bonds are due 2010 to 2026 with a term bond due 2025. The serials have coupons from 3% to 5.25% and yields from 2.22% to 5.27%. The 2025 bond has a 5.5% coupon to yield 5.2%.

The proceeds will be used for making pledged loans to municipalities for improvements to wastewater treatment facilities.

U of Texas bonds to price

Looking to upcoming offerings after Thanksgiving, the University of Texas System is slated to sell $255 million in series 2008A revenue financing system bonds on Dec. 9, said a preliminary official statement.

The bonds (//AAA) will be sold on a negotiated basis with Morgan Stanley as the senior manager.

Proceeds will be used to refund outstanding revenue financing system commercial paper notes.

Also coming up, the City of Houston plans to price $450 million in series 2008 taxable pension obligation and taxable pension obligation refunding bonds, said a preliminary official statement.

The sale includes $430 million in series 2008A taxable pension obligation refunding bonds and $20 million in series 2008B taxable pension obligation bonds.

The bonds (Aa3/AA/) will be sold on a negotiated basis with J.P. Morgan Securities as the senior manager.

Proceeds from the series 2008A bonds will be used to refund, prepay and defease the city's series 2004 collateralized pension obligation notes. Proceeds from the 2008B bonds will be used to fund an unfunded portion of the Houston Police Officer Pension System.

Secondary still seen off

Looking to the secondary market, munis were still trading down a few basis points on Tuesday, said a trader reached in the afternoon, even as Treasuries improved.

"I think there's still a lot of uncertainty in the market right now," the trader said.

"Most of what I have seen trading, not that there's been a ton of stuff, is off by a few basis points here and there. It feels a lot like yesterday's tone."

In particular trades, the recently freed-to-trade series 2008A revenue refunding bonds from Christus Health in Texas and Louisiana were seen in play with the 6.25% 2028s trading at 6.417%.

Also trading Tuesday were Massachusetts's 2008A G.O. refunding bonds. The 4% 2013s were seen at 3.06%.

In another trade out of the Northeast, Dasny's series 2008 personal income tax revenue bonds were trading. The 5% 2026s were seen trading at 5.187%.

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