Municipals close mixed with Treasuries as supply pours in; Salt River, Connecticut bring debt

By Sheri Kasprzak

New York, May 13 – Municipals were mixed on the session in sync with Treasuries, market insiders said, as new issues continued to flood the market.

Yields were seen flat to 1 to 2 basis points higher on the long end of the curve, said a trader in the afternoon.

New-issue activity remained heavy on the session Wednesday, led by an upsized offering from the Salt River Project Agricultural Improvement and Power District of Arizona. The district reportedly sold more than $900 million of electric system bonds due 2015 to 2045 with 1% to 5% coupons. The full pricing details were not immediately available Wednesday evening.

In a retail order period conducted Tuesday, the 20-year maturity was structured as a 5% coupon to yield 3.28% to the 10-year call, a source familiar with the deal said.

Connecticut offers $500 million

Heading up the day’s primary action, the State of Connecticut hit the market with $500 million of series 2015B general obligation bonds after a two-day retail order period.

The bonds (Aa3/AA/AA) were sold through lead manager Siebert Brandford Shank & Co. LLC.

The bonds are due 2016 to 2035 with 2% to 5% coupons.

Proceeds will be used to finance state capital projects.

New Connecticut deal ahead

The state is also on tap to bring another G.O. deal, this time a variable-rate offering.

Connecticut will follow Wednesday’s 2015B sale with bring $481.62 million of series 2015C-D general obligation bonds.

The deal includes $200 million of series 2015C Sifma index bonds and $281.62 million of series 2015D Sifma index G.O. refunding bonds.

The bonds (Aa3/AA/AA) will be sold on a negotiated basis with Loop Capital Markets LLC as the senior manager. The co-senior managers are Barclays, Raymond James/Morgan Keegan, William Blair & Co. Inc. and Williams Capital Group LP.

The 2015C bonds are due 2017 to 2024 and the 2015D bonds are due 2016 to 2024.

Proceeds will be used to finance capital projects and to refund the state’s series 2005 G.O. bonds.

Austin prices electric bonds

Elsewhere during the day, the City of Austin, Texas, offered up $408.89 million of series 2015 electric utility system revenue refunding bonds.

The bonds (A1/AA-/AA-) were sold through Goldman, Sachs & Co.

The deal included $327,845,000 of series 2015A bonds and $81,045,000 of series 2015B taxable bonds.

The 2015A bonds are due 2021 to 2035 with term bonds due in 2038 and 2045. The serial bonds have 5% coupons with 2.10% to 3.60% yields. The 2038 bonds have a 5% coupon priced at 111.274 to yield 3.69% and the 2045 bonds have a 5% coupon priced at 110.2 to yield 3.80%.

The 2015B bonds are due 2017 to 2032 with a term bond due in 2037. The serial coupons range from 1.108% to 4.262% all priced at par. The 2037 bonds have a 4.663% coupon priced at par.

Proceeds will be used to refund the city’s series 2006, 2006A, 2008A and 2010A electric utility revenue refunding bonds.

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