Morning Commentary: Telus, Life Storage, Consumers Energy market notes; Sabra tightens

By Cristal Cody

Tupelo, Miss., May 22 – At least three high-grade companies are marketing bond offerings in the primary market on Wednesday.

Telus Corp. plans to price a dollar-denominated offering of 30-year fixed-rate senior notes.

Life Storage LP intends to sell new 10-year fixed-rate senior notes that are fully and unconditionally guaranteed by parent company Life Storage, Inc.

Consumers Energy Co. is offering fixed-rate first mortgage bonds on Wednesday.

More than $13 billion of investment-grade bonds have priced week to date with supply led by Wells Fargo Bank NA’s $2.1 billion two-part offering of senior bank notes on Monday.

Deal volume is expected to thin after Wednesday ahead of the early market close on Friday and long Memorial Day holiday weekend.

About $20 billion to $25 billion of issuance was forecast by syndicate sources for the week.

New issues priced on Monday and Tuesday are trading mostly flat to tighter, a source said.

The $300 million of 4.8% senior notes due June 1, 2024 (Ba1/BBB-/BBB-) that Sabra Health Care LP and Sabra Capital Corp. priced on Tuesday was among the strongest in secondary trading at the 242 basis points area.

In price, the notes traded early Wednesday improved at 100.76.

Sabra sold the notes at 99.863 to yield 4.831% and a spread of 260 bps over Treasuries.

Initial talk was in the Treasuries plus 285 bps area.

Sabra Health and Sabra Capital are subsidiaries of Sabra Health Care REIT, Inc., an Irvine, Calif., real estate investment trust specializing in the health care sector.

Overall secondary market volume rose to $18.21 billion on Tuesday from $15.18 billion on Monday, according to Trace.

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