Darden Restaurants taps high-grade primary market; BB&T, Citigroup, Citibank paper unchanged

By Cristal Cody

Tupelo, Miss., April 10 – Deal volume stayed light on Monday in the high-grade bond market and is expected to remain thin over the shortened holiday week.

Olive Garden operator Darden Restaurants, Inc. tapped the primary market with a $500 million offering of 10-year senior notes.

General Motors Financial Co. Inc. also was expected to price a three-tranche offering of fixed- and floating-rate three-year notes and seven-year fixed-rate notes. Final pricing details were not available by press time.

About $10 billion of weekly deal volume is expected by syndicate sources for the week. The bond markets are set to close early on Thursday and remain shut on Friday for the Good Friday holiday.

The Markit CDX North American Investment Grade index closed on Monday mostly flat at a spread of 65 basis points.

Bank and financial paper was mostly unchanged on the day.

BB&T Corp.’s 2.75% senior medium-term notes due 2022 were steady.

Citigroup, Inc.’s 4.75% subordinated notes due 2046 headed out flat.

Citibank, NA’s 2% notes due 2019 were stable.

Darden Restaurants prices

Darden Restaurants priced $500 million of 3.85% 10-year senior notes (Baa3/BBB/BBB) on Monday at 99.957 to yield 3.855%, according to an FWP filing with the Securities and Exchange Commission.

The notes priced with a spread of 150 bps over Treasuries.

BofA Merrill Lynch, Goldman Sachs & Co., Wells Fargo Securities LLC, Fifth Third Securities Inc., SunTrust Robinson Humphrey Inc. and U.S. Bancorp Investments Inc. were the bookrunners.

The notes were sold in connection with the company’s planned merger with Cheddar’s Restaurant Holding Corp. There is also a mandatory call at 101 if the merger is not completed.

Proceeds will be used for the merger.

Darden is an Orlando, Fla.-based casual dining operator.

BB&T stable

BB&T’s 2.75% notes due 2022 were unchanged in secondary trading on Monday at 71 bps bid, a source said.

The company priced $1 billion of the five-year notes (A2/A-/A+) on March 16 at a spread of 75 bps over Treasuries.

The bank and financial services company is based in Winston-Salem, N.C.

Citigroup unchanged

Citigroup’s 4.75% subordinated notes due 2046 (Baa3/BBB/A-) traded flat at 184 bps bid, according to a market source.

The notes were priced on Feb. 7 in a $750 million add-on at a spread of 173 bps over Treasuries.

Citigroup originally sold $1 billion of the notes on May 11, 2016 at 98.927 to yield 4.818%, or Treasuries plus 225 bps.

Citigroup is a financial services company based in New York.

Citibank unchanged

Citibank’s 2% notes due 2019 were stable in the secondary market on Monday at 63 bps bid, according to a market source.

Citibank priced $1.5 billion of the 2% two-year notes (A1/A+/) on March 13 at a spread of Treasuries plus 67 bps.

Citibank is a Sioux Falls, S.D.-based commercial and consumer banking products and services company.

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