John Deere upsizes; Ventas units price ahead of bank earnings; Ventas notes tighten in trading

By Andrea Heisinger and Cristal Cody

New York, April 12 - The slow trickle of deals into the high-grade bond market continued Thursday. John Deere Capital Corp. along with Ventas Realty, LP and Ventas Capital Corp. priced offerings.

John Deere had the larger deal of the day at $1 billion in two tranches.

The $600 million sale of seven-year notes from Ventas Realty and Ventas Capital are guaranteed by parent company Ventas, Inc.

The low amount of issuance isn't catching anyone by surprise, sources said.

"I think we've maybe hit the low end [of estimates]," a market source said. "This whole month looks slow."

Friday is looking uneventful. There are earnings being released by JPMorgan Chase & Co. and Wells Fargo & Co., but unless they price bonds after the announcement, the primary isn't expected to see much action.

"Should be quiet," one syndicate source said. "I'm not hearing of anything."

Investment-grade corporate bonds tightened on the day. The Markit CDX Series 18 North American Investment Grade index firmed 5 basis points to a spread of 97 bps.

Ventas' notes due 2017 firmed 7 bps in the secondary market.

Treasuries traded weaker following the government's 30-year bond auction. The 10-year note yield rose 2 bps to 2.05%. The 30-year bond yield moved up 2 bps to 3.21%.

John Deere's tranches

John Deere Capital sold $1 billion of senior medium-term notes (A2/A/) in two parts, according to FWP filings with the Securities and Exchange Commission.

The size of the offering was increased from $750 million, an informed source said. There was "just under $3 billion" on the books, the source added.

The $500 million of 0.875% three-year notes priced at a spread of Treasuries plus 47 bps. The notes were priced lower than talk in the mid-50 bps area, the source said.

A $500 million tranche of 2.25% seven-year paper priced at Treasuries plus 87 bps. The tranche sold below guidance in the mid-90 bps area.

The bookrunners were Bank of America Merrill Lynch, Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC.

The funding arm of agricultural and industrial equipment maker and distributor Deere & Co. is based in Moline, Ill.

Ventas sells $600 million

Ventas Realty and Ventas Capital sold $600 million of 4% seven-year senior notes (Baa2/BBB/BBB+) to yield 265 bps over Treasuries, a market source said.

The paper was priced at the tight end of guidance in the 270 bps area, the source said.

Bank of America Merrill Lynch, Credit Agricole Securities (USA) Inc. and UBS Securities Inc. were the bookrunners.

Proceeds are being used to repay debt under an unsecured revolving credit facility, for working capital and for other general corporate purposes including funding future acquisitions or investments.

The notes due 2019 traded tighter at 258 bps bid, 255 bps offered, a trader said.

Ventas is a Chicago-based real estate investment trust that invests in senior housing and health-care properties.

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