High-grade corporate issuance quiet; deal pipeline builds; Kroger bonds remain soft

By Cristal Cody

Tupelo, Miss., Oct. 12 – U.S. high-grade corporate supply stayed quiet on Thursday, while the deal pipeline continues to build, according to market sources.

Banco Santander, SA continued a three-day roadshow that ends Friday for a Rule 144A and Regulation S dollar-denominated offering of senior notes (A3/BBB+/A-), according to a market source.

Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and Santander Investment Securities Inc. are the arrangers.

Coming up in the week ahead, the Federation des caisses Desjardins du Quebec (Aa2/A+/AA-) plans to hold a roadshow Oct. 18 to Oct. 20 for a dollar-denominated Rule 144A and Regulation S notes offering, according to a market source.

Barclays is the bookrunner.

The Markit CDX North American Investment Grade 29 index softened about 1 basis point to close at a spread of 55.5 bps.

In secondary trading, Kroger Co.’s 3.7% notes due Aug. 1, 2027 eased about 2 bps on Thursday after the bonds softened 5 bps in the previous session. Kroger announced on Wednesday that it is considering selling its chain of convenience stores.

The retail grocery industry has been affected by concerns since Amazon.com, Inc. purchased Whole Foods Markets Inc. in a $13.7 billion deal that closed in August.

Amazon.com’s 3.15% notes due Aug. 22, 2027 priced in August were unchanged after improving 1 bp on Wednesday.

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