MetLife sells bonds as others stand down on weak tone; Vivendi widens; Apache short end firms

By Andrea Heisinger and Cristal Cody

New York, April 4 - MetLife Global Funding I was in the high-grade bond market Wednesday with a small sale as others chose to stand down.

The funding arm of insurance company MetLife Inc. sold $250 million of 10-year notes via Rule 144A and Regulation S.

Terms were also given for an upsized $150 million issue of preferred stock from Aspen Insurance Holdings Ltd.

The week was expected to be top heavy, and it was. Most companies got their bond deals out of the way on Monday and Tuesday prior to the Federal Reserve Federal Open Market Committee meeting.

The market tone suffered after no indication of a third round of quantitative easing came from the Fed meeting and was weaker still at the open Wednesday.

"The market was just really bad today," a syndicate source said. "We had some calls, but everyone decided to stand down. It was too weak."

The Dow Jones industrial average dropped throughout the day, and there were headlines out of Europe about debt woes in Spain and other troubled countries.

There aren't any deals expected for Thursday or Friday, which most desks are treating as a holiday even though the market will be open until noon ET.

The Markit CDX Series 18 North American Investment Grade index eased 2 basis points to a spread of 93 bps on the day.

MetLife's new notes traded 5 bps tighter in the secondary market.

French entertainment company Vivendi SA's three tranches of bonds (Baa2/BBB/BBB) sold in a $2 billion offering on Tuesday widened 3 bps to 20 bps in secondary trading on Wednesday.

Apache Corp.'s three tranches sold on Tuesday were mixed in trading on Wednesday, with the shorter-dated notes tightening 3 bps to 4 bps.

Bank of Nova Scotia's 2.55% notes due 2017 widened 7 bps on the day, a source said.

A trader saw bank credit default swaps costs 2 bps to 15 bps higher and brokerage CDS costs 6 bps to 15 bps higher.

Treasuries rallied. The benchmark 10-year note yield fell 8 bps to 2.22%. The 30-year bond yield dropped 7 bps to 3.36%.

MetLife sells 10-year

MetLife Global Funding I priced $250 million of 3.875% 10-year bonds (Aa3/AA-/) to yield Treasuries plus 165 bps, a market source away from the trade said.

The deal was priced under Rule 144A and Regulation S.

Deutsche Bank Securities Inc. and UBS Securities LLC were the bookrunners.

MetLife's notes traded at 160 bps bid, 153 bps offered in the secondary market, a trader said. Later in the afternoon, the notes were seen by another trader at 160 bps bid, 155 bps offered.

The funding arm of MetLife is based in New York.

Aspen's upsized preferreds

Aspen Insurance Holdings priced $150 million of 7.25% $25-par perpetual noncumulative preference shares on Tuesday, according to an FWP filing with the Securities and Exchange Commission.

Price talk was 7.25% to 7.75%, and it was originally expected that $100 million of preference shares would be issued.

There is a $22.5 million over-allotment option.

The price is $25 per preference share.

Aspen Insurance will apply to list the preference shares on the New York Stock Exchange under the ticker symbol "AHLPB."

Citigroup Global Markets Inc., Barclays Capital Inc., UBS Securities LLC and Wells Fargo Securities LLC were the bookrunners.

Proceeds will be used for general corporate purposes, including supporting insurance and reinsurance activities through operating subsidiaries, and for repurchasing ordinary shares from time to time.

Aspen Insurance is an insurance and reinsurance company based in Hamilton, Bermuda.

Vivendi widens

Vivendi's bonds widened as much as 20 bps in the secondary market on Wednesday, a trader said.

The 2.4% notes due 2015 eased 3 bps to 188 bps bid, 181 bps offered. The issue priced in a $550 million tranche at 185 bps over Treasuries.

The tranche of 3.45% notes due 2017 widened 13 bps to 248 bps bid, 243 bps offered in secondary trading. Vivendi sold $650 million of the five-year notes at a spread of Treasuries plus 235 bps.

The third tranche of 4.75% notes due 2022 widened 20 bps to 270 bps bid, 263 bps offered by late afternoon on Wednesday. The company sold $800 million of the 10-year notes at Treasuries plus 250 bps.

The entertainment company is based in Paris.

Apache mixed

Apache's $3 billion of notes (A3/A-/A-) priced in three tranches on Tuesday traded mostly better, traders said on Wednesday.

The 1.75% notes due 2017 firmed to 66 bps bid, 61 bps offered. Going out, the notes were seen trading flat at 70 bps bid, 65 bps offered by a trader at another desk. Apache sold $400 million of the five-year paper at a spread of Treasuries plus 70 bps.

The second tranche of 3.25% notes due 2022 firmed to 97 bps bid, 92 bps offered. The company priced $1.1 billion of the 10-year notes at 100 bps over Treasuries.

The third tranche of 4.75% bonds due 2043 traded flat at 135 bps bid, 130 bps offered and later widened to 138 bps bid, 130 bps offered, traders said. Apache sold $1.5 billion of the long bonds at Treasuries plus 135 bps.

The Houston-based energy company explores for, produces and transports natural gas, crude oil and natural gas liquids.

Scotiabank widens

Bank of Nova Scotia's 2.55% notes due 2017 (Aa1/AA-/) widened 7 bps to 100 bps over Treasuries, a source said on Wednesday.

Scotiabank sold $1.25 billion of the notes (Aa1/AA-/) on Jan. 5 at a spread of 172 bps plus Treasuries.

The Canadian bank is based in Halifax, N.S.

Stephanie N. Rotondo contributed to this review

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