Bank of America, Toyota, Intel, AvalonBay price notes; Carrier, Otis in deal pipeline

By Cristal Cody

Tupelo, Miss., Feb. 10 – Investment-grade issuers priced more than $10 billion of notes on Monday, led by Bank of America Corp.’s $5 billion two-part offering of fixed-to-floating-rate senior notes.

Toyota Motor Credit Corp. came by with a $2.5 billion three-tranche offering of medium-term notes.

Intel Corp. priced a $2.25 billion three-part offering of new and reopened senior notes during the session.

Also, AvalonBay Communities, Inc. priced an upsized $700 million of 10-year medium-term notes.

Strong deal volume is expected this week with about $25 billion to as much as $35 billion of supply forecasted, syndicate sources said.

Last week, more than $21 billion of corporate bonds and more than $11 billion of sovereign, supranational and agency notes priced.

A strong boost to the deal total is expected from Carrier Global Corp. and Otis Worldwide Corp. with fixed income investor calls scheduled this week for possible bond offerings totaling more than $14 billion.

The Markit CDX North American Investment Grade 33 index was modestly tighter on the day at a spread of 45.1 basis points.

Bank of America prices $5 billion

Bank of America priced $5 billion of series N medium-term fixed-to-floating-rate senior notes (A2/A-/A+) in two tranches on Monday, according to a market source.

A $1.5 billion tranche of 2.015% notes due Feb. 13, 2026 priced at a Treasuries plus 65 bps spread.

Initial price talk was at a spread in the Treasuries plus 80 bps area.

The notes will reset following the initial fixed-rate period to a floating rate of Libor plus 64 bps.

Bank of America sold $3.5 billion of 2.496% notes due Feb. 13, 2031 at a 95 bps over Treasuries spread, compared to initial price talk in the Treasuries plus 110 bps area.

The notes will reset after the initial fixed-rate period to a floating rate of Libor plus 99 bps.

BofA Securities Inc. was the bookrunner.

The financial services company is based in Charlotte, N.C.

Toyota Motor sells $2.5 billion

Toyota Motor Credit (Aa3/AA-/A+) sold $2.5 billion of medium-term notes in three parts on Monday, according to a market source.

The company placed $1.1 billion of floating-rate notes due Aug. 13, 2021 at Libor plus 12.5 bps. The floaters were initially talked to price at the Libor plus low 20 bps area.

A $650 million tranche of 1.8% notes due Feb. 13, 2025 priced with a spread of Treasuries plus 45 bps.

Initial talk was at the high 50 bps over Treasuries area.

The company also sold $750 million of 2.15% green notes due Feb. 13, 2030 at a 65 bps over Treasuries spread.

Initial price talk is at a spread in the Treasuries plus high 70 bps area.

BNP Paribas Securities Corp., Credit Agricole Securities (USA) Inc., Citigroup Global Markets Inc., J.P. Morgan Securities LLC and Mizuho Securities USA LLC were the bookrunners.

Toyota Motor Credit is a Torrance, Calif.-based financing arm and subsidiary of Toyota Motor Corp.

Intel raises $2.25 billion

Intel priced a $2.25 billion three-part offering of new and reopened senior notes (A1/A+/A+), according to an informed source.

The company brought a $750 million add-on to its 2.45% notes due Nov. 15, 2029 at a Treasuries plus 65 bps spread.

Initial price talk was in the 85 bps spread area.

Intel originally sold $1.25 billion of the notes on Nov. 18, 2019 at 99.868 to yield 2.465% and a spread of 65 bps over Treasuries. The total outstanding is now $2 billion.

The company also priced a $500 million add-on to its 3.25% notes due Nov. 15, 2049 at a Treasuries plus 90 bps spread.

The notes were talked to price in the Treasuries plus 110 bps area.

Intel first sold the bonds in a $1.5 billion tranche in the Nov. 18 offering at 99.943 to yield 3.253% and a Treasuries plus 95 bps spread. The total outstanding is now $2 billion.

In the new issue, Intel sold $1 billion of 3.1% notes due Feb. 15, 2060 at a Treasuries plus 110 bps spread.

Initial price talk was in the Treasuries plus 130 bps area.

Goldman Sachs & Co. LLC and Wells Fargo Securities LLC were the bookrunners.

Intel is a semiconductor chip maker based in Santa Clara, Calif.

AvalonBay upsizes deal

AvalonBay Communities priced an upsized $700 million of 2.3% 10-year medium-term notes (A3/A-/) during the session at 99.893 and a spread of Treasuries plus 77 bps, according to a market source and an FWP filing with the Securities and Exchange Commission.

Initial price talk on the notes due March 1, 2030 was in the Treasuries plus 95 bps area.

The deal was upsized from $650 million.

Deutsche Bank Securities Inc., Goldman Sachs and Morgan Stanley & Co. LLC were the bookrunners.

The manager and developer of apartment communities is based in Arlington, Va.

Carrier, Otis plan deal calls

Looking ahead to Tuesday and Wednesday, Carrier Global plans to hold fixed income investor calls for a potential $9.2 billion offering of senior notes (Baa3/BBB/) as part of its spin-off from United Technologies Corp., according to market sources.

In addition, a bond offering is anticipated from Otis Worldwide, which also is being spun off from United Technologies.

Otis is expected to hold fixed income investor calls following Carrier Global with a possible offering of senior notes (Baa2/BBB/) being considered at $5.3 billion.

The deals are being looked to print on Thursday.

Goldman Sachs, J.P. Morgan and Morgan Stanley are the investor call arrangers.

Farmington, Conn.-based Carrier Global is a heating and cooling systems provider.

Elevator and escalator maker Otis Worldwide is based in Farmington, Conn.

United Technologies is a Hartford, Conn.-based company that provides technology products and services to the building and aerospace industries.

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