Light deal volume forecast; Walgreens firms; Whole Foods flat; CBS, Enbridge notes improve

By Cristal Cody

Tupelo, Miss., June 30 – The investment-grade primary market stayed quiet over Friday’s session with desks thinly staffed ahead of the early market close on Monday and Fourth of July holiday on Tuesday.

Primary action is expected to be light in the week ahead with the holiday and the June non-farm payroll report set for release on July 7.

Syndicate sources forecast about $5 billion to $10 billion of supply for the week. Banks are expected to be in the primary market later in July.

In the secondary market on Friday, Walgreens Boots Alliance Inc.’s 3.45% notes due June 1, 2026 tightened about 5 basis points after trading about 1 bp better in the previous session. The company announced on Thursday that it would abandon its plan to acquire Rite Aid Corp. and instead purchase more than 2,100 Rite Aid stores.

Whole Foods Market Inc.’s 5.2% notes due Dec. 3, 2025 were unchanged on the day but remain tight to where the bonds traded before Amazon.com, Inc. announced earlier in June plans to acquire the natural and organic foods grocery chain.

Retailer Kroger Co.’s senior notes (Baa1/BBB/BBB) were flat in the secondary market.

Earlier in the day, General Motors Financial Co. Inc.’s $2.25 billion three-part offering of senior notes on Tuesday were mixed but traded about 6 bps to 12 bps tighter than issuance.

CBS Corp.’s $900 million of senior notes (Baa2/BBB/BBB) priced in two tranches on Monday traded better on Friday.

Enbridge Inc.’s $1.4 billion of senior notes sold in two tranches on Tuesday firmed about 2 bps in earlier secondary trading.

The Markit CDX North American Investment Grade index closed about 1 bp tighter on Friday at a spread of 61 bps.

Walgreens tightens

Walgreens’ 3.45% notes due June 1, 2026 firmed about 5 bps to 117 bps bid, according to a market source.

The notes headed out about 1 bp tighter on Thursday at 122 bps bid.

The retailer sold $1.9 billion of the notes on May 26, 2016 at a spread of 165 bps over Treasuries.

Walgreens Boots Alliance is a subsidiary of Deerfield, Ill.-based drugstore operator Walgreens Co.

Whole Foods flat

Whole Foods Market’s 5.2% notes due Dec. 3, 2025 (Baa3/BBB-/) were going out on Friday unchanged at 89 bps bid, according to a market source.

The company’s bonds came in about 85 bps to 92 bps bid on June 16 after Amazon.com announced it will purchase the natural and organic foods grocer for $13.7 billion in cash.

Austin, Texas-based Whole Foods sold $1 billion of the notes on Nov. 30, 2015 at a Treasuries plus 300 bps spread.

Kroger unchanged

Kroger’s 2.65% notes due Oct. 15, 2026 were flat at 135 bps bid in secondary trading, according to a market source.

Kroger sold $750 million of the notes on Sept. 26 at a spread of 110 bps over Treasuries.

The company’s 4.45% notes due Feb. 1, 2047 also were unchanged on Friday at 185 bps bid.

The Cincinnati-based grocery retailer sold $1 billion of the bonds on Jan. 17 at a spread of 150 bps over Treasuries.

GM Financial mixed

General Motors Financial’s 3.15% notes due June 30, 2022 softened about 1 bp from Thursday to 125 bps bid, 122 bps offered, according to a market source early Friday.

The company (Baa3/BBB/BBB) sold $1.25 billion of the five-year notes on Tuesday at a spread of 137 bps over Treasuries.

General Motors Financial’s reopened 4.35% notes due Jan. 17, 2027 traded unchanged over the morning at 189 bps bid, 186 bps offered.

The company sold $500 million of the 10-year notes in a reopening on Tuesday at a spread of Treasuries plus 195 bps.

General Motors Financial originally sold $750 million of the notes on Jan. 12 at a spread of 200 bps over Treasuries.

The finance subsidiary of General Motors Co. is based in Fort Worth.

CBS notes firm

CBS’ 2.5% notes due Feb. 15, 2023 traded at 83.5 bps bid, 82.5 bps offered earlier on Friday, according to a market source.

The notes were seen on Thursday at 84 bps bid, 81 bps offered.

The company priced $400 million of the notes on Monday at a spread of Treasuries plus 85 bps.

CBS’ 3.375% notes due Feb. 15, 2028 firmed to 131 bps bid, 128.5 bps offered in secondary trading.

The notes traded in the previous session at 133 bps bid, 130 bps offered.

CBS sold $500 million of the notes on Monday at a Treasuries plus 135 bps spread.

The broadcasting company is based in New York.

Enbridge better

Enbridge’s 3.7% notes due July 15, 2027 traded at 145 bps bid, 141 bps offered earlier in the day, a market source said.

The notes were quoted on Thursday at 147 bps bid, 145 bps offered.

Enbridge (Baa2/BBB+/BBB+) sold $700 million of the 10-year notes on Tuesday at a Treasuries plus 150 bps spread.

Enbridge is a Calgary, Alta.-based oil and gas distribution and transportation company.

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