Morning Commentary: Front-loaded supply forms; Coca-Cola, Chubb, WEC, UMB on deck

By Cristal Cody

Tupelo, Miss., Sept. 14 – Strong front-loaded issuance in the high-grade primary market is expected this week ahead of the Federal Reserve’s monetary policy decision due Wednesday, sources report.

The deal pipeline filled quickly early Monday with numerous companies marketing bonds.

Coca-Cola Co. is offering three tranches of fixed-rate senior notes (A1/A+) due in 2028, 2031 and 2051.

Chubb INA Holdings Inc. is on deck with $1 billion of 10-year guaranteed fixed-rate senior notes (A3/A/A).

Delta Air Lines Inc. and SkyMiles IP Ltd. are marketing $4 billion of expected split-rated senior secured notes (//BBB) in two tranches in a telephone roadshow that starts Monday and runs through Thursday. The Rule 144A and Regulation S deal includes five- and eight-year tranches.

Sumitomo Mitsui Financial Group Inc. plans to price an add-on to its 1.474% senior notes due July 8, 2025 (A1/A) and sell new 10-year subordinated notes (A2/A-).

The bank first sold $1.5 billion of the five-year notes on June 29 at a spread of Treasuries plus 120 basis points.

Southern California Gas Co. is offering three-year floating-rate notes (Aa2/A+/AA-) over the day.

Healthcare Trust of America Holdings, LP intends to sell new guaranteed senior notes due 2031 (Baa2/BBB).

WEC Energy Group, Inc. is on deck with an offering of fixed-rate senior notes (Baa1/BBB+/BBB+) during the session.

HollyFrontier Corp. is offering two tranches of fixed-rate senior notes due in 2023 and 2030 (Baa3/BBB-/BBB-) on Monday.

Flowserve Corp. is marketing fixed-rate senior notes (Baa3/BBB-/BBB-) in a registered offering.

In addition, UMB Financial Corp. (A-/A) plans to price fixed-to-fixed rate subordinated notes due 2030.

Investment-grade supply beat market forecasts last week with corporate volume of more than $65 billion, including issuance on Friday.

About $50 billion to $60 billion of deal volume was expected following the Labor Day holiday.

This week, about $35 billion to $40 billion of high-grade supply is forecast to print.

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