Citi, News America, ADM, CNA, KfW sells as issuance ramps up; deals firm, GE Capital narrows

By Andrea Heisinger and Cristal Cody

New York, Feb. 9 - CNA Financial Corp., Citigroup Inc., Archer-Daniels-Midland Co., KfW, News America Inc., Bank Nederlandse Gemeenten and the Council of Europe Development Bank each priced bonds Wednesday in the most packed market of the week so far.

The largest corporate sale of the day came from News Corp. subsidiary News America. The media conglomerate priced $2.5 billion in maturities of 2021 and 2041 under Rule 144A.

One of the first bonds to price came from CNA Financial with its $400 million of 10-year notes.

German development bank KfW sold $4 billion of five-year global notes.

Another corporate deal came from Archer-Daniels-Midland with a $1.5 billion sale of floating-rate notes due in 2012.

The Council of Europe Development Bank sold $1 billion of five-year senior notes as one of the handful of sovereign names in the market.

A late-day sale was done by Citigroup Inc. The banking giant priced $1.25 billion of two-year floating-rate notes.

There was also a $1 billion sale of 10-year notes from Bank Nederlandse, a source away from the deal said. Terms were not available at press time.

A syndicate source who worked on one of the day's sales said that they were unclear why there were so many deals in the market for the day.

"It's anyone's guess," they said.

A source the previous week had said that issuers were not going to jump in until mid-week after some Treasury bond auctions, to see how successful they were.

There could be more bonds coming out on Thursday in response to the encouraging interest in Wednesday's corporate paper.

"I've heard of a few things for tomorrow," a source said. "If it's a solid open we should see at least a couple of things."

General Electric Capital Corp.'s notes sold Tuesday traded more than 40 basis points tighter early Wednesday, a trader said.

New paper from CNA Financial and Archer-Daniels-Midland firmed in the secondary market, while News America two tranches of bonds were mixed, traders said.

Overall investment-grade Trace volume was strong at nearly $19 billion, up 16% on the day, a market source said.

The Markit CDX Series 14 North American investment-grade index eased 2 basis points to a spread of 81 bps, according to Markit Group Ltd.

Treasuries broke a week-long losing streak on Wednesday on a strong auction that attracted a record amount of foreign interest. The 10-year note yield dropped 9 basis points to 3.65%. The yield on the 30-year bond fell 5 bps to 4.71%.

"What we saw was a massive amount of indirect bidders accounted for 71% of the auction," a source said. "That's the highest we have ever seen."

Indirect bidders include foreign central banks, while direct bidders include non-primary dealers.

News Corp. brings two tranches

News America sold $2.5 billion of notes (Baa1/BBB+/BBB+) in two parts, a source away from the offering said ahead of the market close.

A $1 billion tranche of 4.5% 10-year notes priced at a spread of Treasuries plus 95 bps.

The second part was $1.5 billion of 6.15% 30-year bonds sold at a 150 bps over Treasuries spread.

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

J.P. Morgan Securities LLC ran the books.

Proceeds are being used for general corporate purposes including the refinancing of near-term maturities.

In the secondary market, News America's notes due 2021 traded wider at 102 bps bid, 97 bps offered, a trader said.

The bonds due 2041 were seen wrapped around the issue price at 150 bps bid, 148 bps offered.

The subsidiary of media company News Corp. is based in New York City.

CNA Financial's 10-years

Global insurance company CNA Financial sold $400 million of 5.75% 10-year notes (Baa3/BBB-/BBB-) to yield 215 bps over Treasuries, an informed source said.

They sold tighter than whispered talk in the 240 bps area, and at the lowest end of revised guidance in the 225 bps area, plus or minus 10 bps.

There was "north of $4 billion" on the books for the sale, a source said.

"There were a lot of good-quality investors - a lot of accounts," the source said. "Even before [guidance] dropped, we didn't have any [account] drops."

Bank of America Merrill Lynch, J.P. Morgan Securities LLC and Wells Fargo Securities LLC were bookrunners.

Proceeds will be used to repurchase, redeem, repay or retire $400 million principal balance of 6% senior notes due Aug. 15, 2011.

In the secondary, the notes due 2021 tightened to 207 bps bid, 205 bps offered, a trader said.

The issuer is based in Chicago.

Citi offers $1.25 billion

Citigroup tapped the high-grade bond market to price $1.25 billion of two-year floating-rate notes (A3/A) at par to yield three-month Libor plus 85 bps, a source close to the sale said.

Citigroup Global Markets Inc. was bookrunner.

The financial services company is based in New York City.

ADM prices floaters

Archer-Daniels-Midland sold $1.5 billion of senior floating-rate notes due 2012 (A2/A/A) at par to yield three-month Libor plus 16 bps, a source close to the sale said.

Barclays Capital Inc., Deutsche Bank Securities Inc. and HSBC Securities (USA) Inc. were bookrunners.

Proceeds are being used for general corporate purposes including working capital, capital expenditures and possible acquisitions of or investments in businesses and assets. They may also be used to repay debt originally incurred for general corporate purposes.

The floating-rate notes narrowed to 13 bps bid, 12 bps offered in the secondary market, a trader said.

The processor of agricultural products is based in Decatur, Ill.

KfW sells $4 billion

German development bank KfW sold $4 billion of 2.625% five-year global notes (Aaa/AAA/AAA) at 99.925, according to an FWP filing with the Securities and Exchange Commission.

They are guaranteed by the Federal Republic of Germany.

Barclays Capital Inc., Deutsche Bank Securities Inc. and Morgan Stanley & Co. Inc. were bookrunners.

KfW's notes due 2016 traded at 30 bps bid, 27 bps offered, a source said.

The issuer is based in Frankfurt.

COE's new five-year

The Council of Europe Development Bank sold $1 billion of 2.625% five-year senior notes (Aaa/AAA/AAA) at a spread of 32.35 bps over Treasuries, or mid-swaps plus 10 bps, according to an FWP filing with the SEC

BNP Paribas Securities Corp., HSBC Securities (USA) Inc., J.P. Morgan Securities LLC and RBC Capital Markets Corp. handled the books for the sale.

Proceeds are being used for the general operations of the bank, including loan disbursements.

The European funding agency for the financing and development of social projects is based in Paris.

GE Capital narrows

General Electric Capital sold $2 billion in 5.3% subordinated notes due Feb. 11, 2021 (Aa3/AA/) at a spread of 162.5 bps over Treasuries on Tuesday.

A trader said the notes were quoted at 120 bps early Wednesday.

Fairfield, Conn.-based General Electric Capital is the financing arm of General Electric Co.

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