Municipals end little changed as new deals hit the market; University of Alabama brings bonds

By Sheri Kasprzak

New York, Aug. 12 – Municipals remained unchanged on the Tuesday session as the first offerings of the week hit the market, insiders said.

Secondary action remained light with less than $3.5 billion of trades completed by about 3:30 p.m. ET, said a trader during the afternoon.

New issues started to price during the day, but the bulk of the week’s new offerings are scheduled to come to market later in the week.

University of Alabama prices

Leading the day’s primary action was a competitive sale from the University of Alabama, which priced $241,045,000 of series 2014 general revenue bonds.

The deal included $25.78 million of series 2014A bonds and $215,265,000 of series 2014B bonds, said pricing sheets.

The 2014A bonds are due 2015 to 2021 with 5% coupons with 0.14% to 1.77% yields.

The 2014B bonds are due 2022 to 2044 with 3% to 5% coupons.

The bonds (Aa2/AA-/) were sold competitively. TD Securities USA LLC won the bid for the 2014A bonds at a 1.389413% true interest cost, and BofA Merrill Lynch took the series 2014B bonds at a 3.536615% TIC, said a source close to the deal.

Proceeds will be used to construct and equip a new baseball stadium, a performing arts center and a classroom building; to make other improvements to facilities at the university’s Tuscaloosa campus and to refund existing debt.

St. Luke’s prices bonds

Elsewhere during the session, the Idaho Health Facilities Authority hit the market with $166,285,000 of series 2014A revenue bonds for the St. Luke’s Health System.

The bonds (A3/A-/) were sold through J.P. Morgan Securities LLC and Wells Fargo Securities LLC.

The bonds are due 2016 to 2032 with term bonds due in 2034, 2037, 2039 and 2044, said a term sheet. The serial coupons range from 2% to 5%. The 2034 bonds have a 5% coupon and priced at 109.184. The 2037 bonds have a 4.125% coupon and priced at 98.626. The 2039 bonds have a 5% coupon and priced at 107.776. The 2044 bonds have a 5% coupon and priced at 107.366.

Proceeds will be used to finance improvements to the health system’s flagship downtown Boise campus, the construction of a medical plaza adjacent to current facilities in Twin Falls, the expansion of the health system’s Nampa facility, the purchase of equipment for the Mountain States Tumor Institute Project in Boise and to install electronic health records for the system.

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