High-grade issuers sell nearly $9 billion; Mondelez, TransCanada, Hershey, S&P, Oshkosh print

By Cristal Cody

Tupelo, Miss., May 3 – Investment-grade corporate issuers priced nearly $9 billion of bonds on Thursday following thin supply over the previous two sessions.

Mondelez International, Inc. sold $2.5 billion of notes in four tranches.

TransCanada Pipelines Ltd. priced $2.5 billion of senior notes in three parts.

Hershey Co. priced $1.2 billion of senior notes in three tranches on the tight side of guidance.

Also on Thursday, corporate issuers including S&P Global Inc., GATX Corp., Florida Power & Light Co., Republic Services, Inc. and Oshkosh Corp. tapped the primary market.

The European Bank for Reconstruction and Development also priced an upsized $550 million of four-year floating-rate notes.

In other activity during the session, Amcor Ltd. began the first of an expected two-day round of fixed income investor calls, a source said. The company plans to price 10-year senior notes in a Rule 144A and Regulation S transaction.

The Markit CDX North American Investment Grade 30 index eased more than 1 basis point to close at a spread of 62.5 bps.

Mondelez prices four tranches

Mondelez International priced a $2.5 billion four-tranche offering of notes (Baa1/BBB/) on Thursday, according to an FWP filing with the Securities and Exchange Commission.

The company sold $750 million of 3% two-year notes at 99.846 to yield 3.08%, or a spread of Treasuries plus 60 bps.

It also priced $$750 million of 3.625% three-year notes at 99.742 to yield 3.682%. The notes priced with a Treasuries plus 90 bps spread.

A $700 million tranche of 4.125% 10-year notes priced at 99.022 to yield 4.246%, or Treasuries plus 130 bps spread.

In the final tranche, the company sold $300 million of 4.625% 30-year notes at 98.373 to yield 4.727%. The bonds priced with a spread of 160 bps over Treasuries.

Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC, Mizuho Securities USA Inc., Barclays, BNP Paribas Securities Corp., MUFG and Wells Fargo Securities, LLC were the bookrunners.

Mondelez is an East Hanover, N.J.-based manufacturer of biscuits, chocolate, gum, candy and other products.

TransCanada raises $2.5 billion

TransCanada Pipelines (A3/A-/A-) priced $2.5 billion of senior notes in three tranches on Thursday, according to a market source.

The company sold $1 billion of 4.25% 10-year notes with a spread of 135 bps over Treasuries.

TransCanada priced $500 million of 4.75% 20-year notes with a 165 bps over Treasuries spread.

The $1 billion tranche of 4.875% 30-year notes were sold with a Treasuries plus 180 bps spread.

J.P. Morgan Securities and Deutsche Bank Securities Inc. were the bookrunners.

The company held fixed income investor calls on Tuesday.

TransCanada is a natural gas and oil pipeline and storage company based in Calgary, Alta.

Hershey prices $1.2 billion

Hershey sold $1.2 billion of senior notes (/A/) in three tranches on the tight side of guidance on Thursday, according to a market source and an FWP filing with the SEC.

The company priced $350 million of 2.90% two-year notes at a spread of 45 bps over Treasuries, or 99.934 to yield 2.934%.

It sold $350 million of 3.10% three-year notes at 99.931 to yield 3.124% and with a Treasuries plus 50 bps spread.

A $500 million tranche of 3.375% five-year notes priced with a spread of 60 bps over Treasuries. The notes priced at 99.958 to yield 3.384%.

Bookrunners were Citigroup Global Markets, BofA Merrill Lynch and RBC Capital Markets LLC.

The maker of chocolate and confectionery products is based in Hershey, Pa.

Republic Services sells notes

Republic Services sold $800 million of 3.95% 10-year notes (Baa3/BBB+/BBB) Thursday on the tight side of guidance at a spread of 118 bps over Treasuries, according to a market source and an FWP filed with the SEC.

The notes priced at 98.602 to yield 4.122%.

J.P. Morgan Securities, BofA Merrill Lynch, U.S. Bancorp Investments Inc., Barclays, Mizuho Securities, MUFG, Scotia Capital (USA) Inc., SMBC Nikko Securities America, Inc. and SunTrust Robinson Humphrey, Inc. were the bookrunners.

Republic Services is a waste collection company based in Phoenix.

Oshkosh in primary

Oshkosh priced $300 million of 4.60% 10-year senior notes (Ba1/BBB/BBB-) on Thursday with a Treasuries plus 170 bps spread, on the tight side of guidance in the Treasuries plus 175 bps area, according to a market source and an FWP filing with the SEC.

The notes priced at 99.652 to yield 4.644%.

J.P. Morgan Securities, BofA Merrill Lynch, Wells Fargo Securities, LLC and U.S. Bancorp Investments, Inc. were the bookrunners.

Oshkosh held fixed-income investor calls on Tuesday.

Oshkosh is a a Oshkosh, Wis.-based industrial manufacturer of specialty vehicles and vehicle bodies.

GATX sells $300 million

GATX sold $300 million of 4.55% 10-year senior notes (Baa2/BBB/) on Thursday at par to yield a spread of 160 bps over Treasuries, according to a market source and an FWP filing with the SEC.

The notes priced on the tight side of guidance in the Treasuries plus 160 bps to 165 bps area.

Citigroup Global Markets, BofA Merrill Lynch and Morgan Stanley & Co. LLC were the bookrunners.

GATX is a transportation leasing company based in Chicago.

S&P Global brings deal

S&P Global priced $500 million of 4.50% 30-year senior notes (Baa1//BBB+) on Thursday on top of guidance at a spread of 145 bps over Treasuries, according to a market source and an FWP filing with the SEC.

The bonds priced at 98.751 to yield 4.577%.

Goldman Sachs & Co., Deutsche Bank Securities, BofA Merrill Lynch, Mizuho Securities USA LLC, Citigroup Global Markets, J.P. Morgan Securities and Morgan Stanley were the bookrunners.

New York City-based S&P Global provides credit ratings, benchmarks, analytics and data to capital and commodity markets.

Florida Power prints

Florida Power & Light sold $500 million of 4.125% first mortgage bonds due June 1, 2048 on Thursday in line with guidance at a spread of 100 bps over Treasuries, according to a market source and an FWP filed with the SEC.

The notes priced at 99.911 to yield 4.13%.

BNP Paribas Securities, Credit Suisse Securities, BofA Merrill Lynch, Morgan Stanley, CIBC World Markets Corp., KeyBanc Capital Markets Inc. and RBC Capital Markets were the bookrunners.

Florida Power & Light is a Juno Beach, Fla.-based electric utility.

European Bank upsizes

The European Bank for Reconstruction and Development (Aaa/AAA/AAA) priced an upsized $550 million of four-year global floating-rate notes at Libor plus 1 bp on Thursday, according to a market source.

The deal was upsized from $300 million and priced on top of guidance.

BofA Merrill Lynch, BMO Capital Markets Corp. and SG Americas Securities LLC were the bookrunners.

The financial institution is based in London.

Funds gain $1 billion

Investment-grade corporate funds saw yet another inflow, this time for $0.997 billion, according to fund-flow statistics generated by AMG Data Services Inc.

The gain comes after an addition of $2.010 billion the previous week, $1.535 billion the week before that and $3.346 billion the week before that, as reported by the Arcata, Calif.-based unit of Thomson Reuters Corp’ s Lipper analytics division.

The IG funds have now seen eight straight inflows.

Apart from the Feb. 14 and Feb. 21 weeks, every week so far this year has seen positive flows and in fact before those two weeks in February investment-grade corporates saw a 21-week run of inflows dating back to mid-September, according to a Prospect News analysis of the data.

The latest new funds raise the year-to-date inflow for the IG corporates to $39.03 billion from $38.03 billion, once again setting a new peak level for the year so far.

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