CSX, Crown Castle tap primary market; DuPont eyes deal; Duke Energy flat; Chevron mixed

By Cristal Cody

Tupelo, Miss., April 26 – Two issuers tapped the investment-grade bond market on Wednesday with a third set to price in the upcoming session.

CSX Corp. sold $850 million of 10-year senior notes on Wednesday.

The deal caused concerns for one bond covenant watch group. Credit research firm Covenant Review said in a release the bonds “have an extremely limited liens covenant that only limits pledging the capital stock of CSX’s principal operating subsidiary CSXT.”

In addition, the change-of-control provision “is missing several customary triggers, including the trigger for a sale of substantially all assets,” according to the release.

The bond deal also gives CSX a “free option to redeem the bonds at par within some time prior to their maturity,” Covenant Review said.

In other supply, Crown Castle International Corp. sold $350 million of 30-year senior notes.

Coming up on Thursday, E.I. du Pont de Nemours and Co. is expected to price up to $2 billion of three-year notes in two parts.

Looking at secondary market action on Wednesday, energy bonds were mostly unchanged on the day.

Duke Energy Ohio, Inc.’s 3.7% first mortgage bonds due June 15, 2046 traded flat.

Chevron Corp.’s senior notes (Aa2/AA-/) were flat to tighter in the secondary market.

The Markit CDX North American Investment Grade index ended the day mostly unchanged at a spread of 63 basis points.

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