Published on 3/11/2024 in the Prospect News Investment Grade Daily.
New Issue: Humana prices $2.25 billion of notes due 2031, 2054
Chicago, March 11 – Humana Inc. priced $2.25 billion of senior notes in two parts (Baa2/BBB/BBB) on Monday, according to an FWP filing with the Securities and Exchange Commission.
The health insurance company priced $1.25 billion of 5.375% notes due 2031 at 99.94 to yield 5.384%, or at Treasuries plus 127 basis points.
Also in the deal was a tranche of $1 billion of 5.75% notes with a 30-year tenor. The notes priced at 99.949 to yield 5.753%, or at Treasuries plus 147 bps.
The first series has a Treasuries plus 20 make-whole call until Feb. 15, 2031, then a par call.
The second series has a Treasuries plus 25 bps make-whole call until Oct. 15, 2053, then a par call.
Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, Morgan Stanley & Co. LLC, PNC Capital Markets LLC and Wells Fargo Securities, LLC are the joint active bookrunners.
J.P. Morgan Securities LLC, BofA Securities, Inc. and Barclays were passive bookrunners.
The company intends to use the proceeds for general corporate purposes, which may include the repayment of borrowings under the company’s commercial paper program. As of Dec. 31, Humana’s outstanding commercial paper had a weighted average annual interest rate of 5.68% with maturity dates within one year from March 11.
Humana is based in Louisville, Ky.
| Issuer: | Humana Inc.
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| Amount: | $2.25 billion
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| Issue: | Senior notes
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| Bookrunners: | Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, Morgan Stanley & Co. LLC, PNC Capital Markets LLC, Wells Fargo Securities, LLC (active), J.P. Morgan Securities LLC, BofA Securities, Inc. and Barclays (passive)
|
| Senior co-managers: | U.S. Bancorp Investments, Inc., Mizuho Securities USA LLC and Truist Securities, Inc.
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| Co-managers: | Deutsche Bank Securities Inc., Regions Securities LLC, TD Securities (USA) LLC, BNY Mellon Capital Markets, LLC, Fifth Third Securities, Inc., Scotia Capital (USA) Inc., SMBC Nikko Securities America, Inc., Academy Securities, Inc., Bancroft Capital, LLC, Blaylock Van, LLC, Cabrera Capital Markets LLC and R. Seelaus & Co., LLC
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| Trustee: | Bank of New York Mellon Trust Co., NA
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| Counsel to issuer: | Fried, Frank, Harris, Shriver & Jacobson LLP
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| Counsel to underwriters: | Simpson Thacher & Bartlett LLP
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| Trade date: | March 11
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| Settlement date: | March 13
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| Ratings: | Moody’s: Baa2
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| S&P: BBB
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| Fitch: BBB
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| Distribution: | SEC registered
|
|
|
| Notes due 2031
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| Amount: | $1.25 billion
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| Maturity: | April 15, 2031
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| Coupon: | 5.375%
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| Price: | 99.94
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| Yield: | 5.384%
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| Spread: | Treasuries plus 127 bps
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| Call features: | Make-whole call at Treasuries plus 20 bps until Feb. 15, 2031; thereafter at par
|
| Change of control: | At 101
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| Cusip: | 444859CA8
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|
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| Notes due 2054
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| Amount: | $1 billion
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| Maturity: | April 15, 2054
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| Coupon: | 5.75%
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| Price: | 99.949
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| Yield: | 5.753%
|
| Spread: | Treasuries plus 147 bps
|
| Call features: | Make-whole call at Treasuries plus 25 bps until Oct. 15, 2053; thereafter at par
|
| Change of control: | At 101
|
| Cusip: | 444859CB6
|
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