New Issue: Michigan Finance Authority prices $1.79 billion of water, sewer bonds

By Sheri Kasprzak

New York, Aug. 27 – The Michigan Finance Authority priced $1,791,865,000 of series 2014 water and sewer revenue and refunding bonds for the Detroit Water and Sewerage Department, said a pricing sheet.

The bonds (//BBB+) were sold through senior manager Citigroup Global Markets Inc.

The deal included $123.22 million of series 2014C-1 water bonds, $27.47 million of series 2014C-2 AMT water and sewer bonds, $447,325,000 of series 2014C-3 water bonds, $95,165,000 of series 2014C-5 water and sewer bonds, $143.88 million of series 2014C-6 water bonds, $76,715,000 of series 2014C-7 water and sewer bonds, $23.24 million of series 2014C-8 water and sewer bonds, $206.54 million of series 2014D-1 water and sewer bonds, $188,455,000 of series 2014D-2 water and sewer bonds, $62.7 million of series 2014D-3 water and sewer bonds, $307,645,000 of series 2014D-4 water bonds, $9.27 million of series 2014D-5 taxable bonds, $65,425,000 of series 2014D-6 water bonds and $14,815,000 of series 2014D-7 water bonds.

The 2014C-1 bonds are due July 1, 2044 and have a 5% coupon priced at 100.96.

The 2014C-2 bonds are due July 1, 2044 and have a 5% coupon priced at 98.468.

The 2014C-3 bond are due 2020 to 2033 with 5% coupons.

The 2014C-5 bonds are due 2017 to 2020 with 5% coupons.

The 2014C-6 bonds are due 2015 to 2016 and 2032 to 2033 with 2% to 5% coupons.

The 2014C-7 bonds are due 2019 to 2036 with 5% coupons.

The 2014C-8 bonds are due 2015 to 2018 with 2% to 5% coupons.

The 2014D-1 bonds are due 2015 to 2023 with term bonds due in 2035 and 2037. The serial bonds have 5% coupons. The 2035 bonds have a 5% coupon priced at 104.251, and the 2037 bonds have a 5% coupon priced at 103.767.

The 2014D-2 bonds are due 2023 to 2028 with 5% coupons.

The 2014D-3 bonds are due 2018 to 2020 with 5% coupons.

The 2014D-4 bonds are due 2015 to 2017 and 2029 to 2032 with a term bond due in 2034. The serial coupons range from 2% to 5%. The 2034 bonds have a 5% coupon priced at 102.095.

The 2014D-5 bonds are due July 1, 2019 and have a 2.85% coupon priced at par.

The 2014D-6 bonds are due 2019 to 2034 with a term bond due in 2036. The serial bonds have 5% coupons. The 2036 bonds have a 5% coupon priced at 100.998.

The 2014D-7 bonds are due 2015 to 2018 with 2% to 5% coupons.

Proceeds from the offering will finance the city’s tender offer, as well as refund existing water and sewer bonds and make improvements to the city’s water and sewer infrastructure.

Issuer:	Michigan Finance Authority/Detroit Water and Sewerage Department
Issue:	Series 2014 water and sewer revenue and refunding bonds
Amount:	$1,791,865,000
Type:	Negotiated
Underwriters:	Citigroup Global Markets Inc. (lead), Barclays, J.P. Morgan Securities LLC, Loop Capital Markets LLC, PNC Capital Markets LLC, BMO Capital Markets, Comerica Securities Inc. and Jefferies & Co. (co-managers)
Rating:	Fitch: BBB+
Pricing date:	Aug. 27
Settlement date:	Sept. 4
$123.22 million series 2014C-1 water bonds
Maturity	Type	Coupon	Price
July 1, 2044	Term	5%	100.96
$27.47 million series 2014C-2 AMT water and sewer bonds
Maturity	Type	Coupon	Price
July 1, 2044	Term	5%	98.468
$447,325,000 series 2014C-3 water bonds
Amount	Maturity	Type	Coupon	Price
$1,155,000	2020	Serial	5%	114.637
$25,425,000	2021	Serial	5%	114.782
$38,945,000	2022	Serial	5%	114.152
$34,215,000	2023	Serial	5%	113.41
$44,015,000	2024	Serial	5%	112.907
$47,045,000	2025	Serial	5%	111.057
$40,375,000	2026	Serial	5%	109.242
$45,895,000	2027	Serial	5%	108.646
$24,075,000	2028	Serial	5%	107.296
$15.77 million	2029	Serial	5%	106.38
$25,285,000	2030	Serial	5%	105.966
$31,945,000	2031	Serial	5%	105.391
$50,515,000	2032	Serial	5%	104.901
$22,665,000	2033	Serial	5%	104.575
$95,165,000 series 2014C-5 water and sewer bonds
Amount	Maturity	Type	Coupon	Price
$25.57 million	2017	Serial	5%	110.404
$35,165,000	2018	Serial	5%	112.564
$15.81 million	2019	Serial	5%	113.73
$18.62 million	2020	Serial	5%	114.11
$143.88 million series 2014C-6 water bonds
Amount	Maturity	Type	Coupon	Price
$22.14 million	2015	Serial	2%	101.042
$32.84 million	2016	Serial	5%	106.95
$9.1 million	2032	Serial	5%	102.728
$79.8 million	2033	Serial	5%	102.49
$76,715,000 series 2014C-7 water and sewer bonds
Amount	Maturity	Type	Coupon	Price
$6,075,000	2019	Serial	5%	112.309
$8,335,000	2020	Serial	5%	112.431
$7,095,000	2021	Serial	5%	112.125
$5.21 million	2022	Serial	5%	111.343
$1.2 million	2023	Serial	5%	110.34
$4,735,000	2024	Serial	5%	109.585
$5,025,000	2025	Serial	5%	107.8
$4,945,000	2026	Serial	5%	106.049
$5.26 million	2027	Serial	5%	105.391
$5.48 million	2028	Serial	5%	104.332
$5.46 million	2029	Serial	5%	103.687
$275,000	2030	Serial	5%	103.047
$280,000	2031	Serial	5%	102.57
$14.45 million	2032	Serial	5%	102.332
$1,595,000	2034	Serial	5%	101.31
$910,000	2035	Serial	5%	101.154
$385,000	2036	Serial	5%	100.998
$23.24 million series 2014C-8 water and sewer bonds
Amount	Maturity	Type	Coupon	Price
$6.31 million	2015	Serial	2%	100.835
$5,125,000	2016	Serial	5%	106.275
$5,955,000	2017	Serial	5%	108.686
$5.85 million	2018	Serial	5%	110.33
$206.54 million series 2014D-1 water and sewer bonds
Amount	Maturity	Type	Coupon	Price
$3,925,000	2015	Serial	5%	103.826
$2.4 million	2016	Serial	5%	107.593
$8,065,000	2017	Serial	5%	110.669
$2,275,000	2018	Serial	5%	112.921
$37,165,000	2020	Serial	5%	114.931
$40.26 million	2021	Serial	5%	114.782
$41,225,000	2022	Serial	5%	114.152
$27,035,000	2023	Serial	5%	113.41
$20.02 million	2035	Term	5%	104.251
$24.17 million	2037	Term	5%	103.767
$188,455,000 series 2014D-2 water and sewer bonds
Amount	Maturity	Type	Coupon	Price
$5,975,000	2023	Serial	5%	113.41
$45,555,000	2024	Serial	5%	112.907
$29,525,000	2025	Serial	5%	111.057
$50.37 million	2026	Serial	5%	109.242
$34.34 million	2027	Serial	5%	108.646
$22.69 million	2028	Serial	5%	107.296
$62.7 million series 2014D-3 water and sewer bonds
Amount	Maturity	Type	Coupon	Price
$39.41 million	2018	Serial	5%	112.564
$21.9 million	2019	Serial	5%	113.73
$1.39 million	2020	Serial	5%	114.11
$307,645,000 series 2014D-4 water bonds
Amount	Maturity	Type	Coupon	Price
$31.96 million	2015	Serial	2%	101.042
$32.5 million	2016	Serial	5%	106.95
$33,825,000	2017	Serial	5%	109.672
$47,265,000	2029	Serial	5%	103.928
$54,305,000	2030	Serial	5%	103.527
$28,515,000	2031	Serial	5%	102.967
$18.95 million	2032	Serial	5%	102.728
$60,325,000	2034	Term	5%	102.095
$9.27 million series 2014D-5 taxable bonds
Maturity	Type	Coupon	Price
July 1, 2019	Term	2.85%	100
$65,425,000 series 2014D-6 water bonds
Amount	Maturity	Type	Coupon	Price
$2.81 million	2019	Serial	5%	112.309
$4.69 million	2020	Serial	5%	112.431
$6,355,000	2021	Serial	5%	112.125
$2.08 million	2022	Serial	5%	111.343
$3.67 million	2023	Serial	5%	110.34
$2.13 million	2024	Serial	5%	109.585
$2.87 million	2025	Serial	5%	107.8
$1,895,000	2026	Serial	5%	106.049
$1.93 million	2027	Serial	5%	105.391
$2.21 million	2032	Serial	5%	102.332
$455,000	2033	Serial	5%	101.702
$1,215,000	2034	Serial	5%	101.31
$33,115,000	2036	Term	5%	100.998
$14,815,000 series 2014D-7 water bonds
Amount	Maturity	Type	Coupon	Price
$3.16 million	2015	Serial	2%	100.835
$725,000	2016	Serial	5%	106.275
$2.63 million	2017	Serial	5%	108.686
$8.3 million	2018	Serial	5%	110.33

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