Glencore Funding launches notes; CPPIB in deal pipeline; U.S. Bank mixed; Target eases

By Cristal Cody

Tupelo, Miss., Oct. 20 – Glencore Funding LLC launched a $1 billion two-part offering of senior notes on Friday in otherwise mostly quiet activity in the investment-grade bond market.

CPPIB Capital Inc. joined the deal pipeline with a $1 billion offering of 10-year notes.

Issuance is expected to be lighter in the week ahead with about $20 billion of volume forecast, a source said.

After spending most of the week unchanged, the Markit CDX North American Investment Grade 29 index firmed more than 1 basis point on Friday to close at a spread of 52.5 bps.

In the secondary market, new issues were mixed on Friday.

U.S. Bank NA’s $1.5 billion of three-year fixed- and floating-rate senior bank notes (A1/AA-/AA-) priced in the previous session traded flat to about 1 bp tighter.

Target Corp.’s 3.9% notes due Nov. 15, 2047 priced on Monday traded 2 bps softer than issuance.

Glencore launches $1 billion

Glencore Funding launched a $1 billion two-part offering of senior notes (Baa2/BBB/) in two tranches on Friday, a market source said.

The deal was expected to price late afternoon and final pricing details were not available by press time.

Glencore Funding launched $500 million of notes due Oct. 27, 2022 at a spread of Treasuries plus 107 bps, on the tight side of guidance in the 110 bps area.

The $500 million tranche of notes due Oct. 27, 2022 were launched on top of guidance at a spread of 160 bps over Treasuries.

Barclays, Citigroup Global Markets Inc., Credit Suisse Securities (USA) Inc., Deutsche Bank Securities Inc. and Societe Generale are the lead managers.

Glencore Funding is a Stamford, Conn.-based U.S. funding arm of Glencore plc.

CPPIB eyes $1 billion sale

CPPIB Capital (Aaa/AAA) plans to price $1 billion of 10-year medium-term notes in a Rule 144A and Regulation S offering, according to a market source on Friday.

BofA Merrill Lynch, BNP Paribas Securities Corp., Deutsche Bank Securities and TD Bank Securities (USA) LLC are the bookrunners.

The deal size is not expected to grow.

CPPIB Capital is a Toronto-based investment management company for the Canada Pension Plan Investment Board.

U.S. Bank fixed notes firm

U.S. Bank’s 2.05% notes due Oct. 23, 2020 traded on Friday at 36 bps bid, 34 bps offered, a market source said.

The company sold $1.2 billion of the notes on Thursday at a spread of Treasuries plus 37 bps.

The commercial bank is based in Cincinnati.

Target bonds ease

Target’s 3.9% notes due Nov. 15, 2047 eased to 112 bps bid, 111 bps offered in the secondary market, a source said.

The company sold $750 million of the 30-year notes (A2/A/A-) on Monday at a spread of Treasuries plus 110 bps.

The discount merchandise chain is based in Minneapolis.

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