Municipals mixed as week’s final deals price; Alameda Corridor, Calif., prices $601 million

By Sheri Kasprzak

New York, May 12 – Municipals rounded out another busy session on a mixed note with the long bond improving and shorter maturities ending flat to slightly weaker, traders said.

The 30-year bond yield fell by 2 basis points to close the day at 2.62% and the 10-year triple-A bond yield holding steady at 1.63%.

Alameda bonds price

The week’s largest offering came from the Alameda Corridor Transportation Authority of California. The authority sold $601,005,000 of series 2016 tax-exempt subordinate revenue refunding bonds, downsized from $661,795,000.

The bonds (A2/AA) were sold through BofA Merrill Lynch and Barclays.

The deal included $30.7 million of series 2016A bonds and $570,305,000 of series 2016B second subordinate lien refunding bonds.

The 2016A bonds are due 2021 to 2025 with 4% to 5% coupons, and the 2016B bonds are due 2034 to 2037 with 3% to 5% coupons.

Yields on the bonds were reduced at final pricing with the longest ending at a 2.92% yield, a downward adjustment of 18 bps, said a source close to the deal.

Proceeds will be used to refund the authority’s series 2004A subordinate lien revenue bonds.

LAX new deal takes off

In other new offerings, the Los Angeles Department of Airports priced $289.21 million of series 2016A subordinate revenue bonds for the Los Angeles International Airport.

The bonds (A1/AA-/AA-) were sold through Loop Capital Markets LLC.

The bonds are due 2017 to 2036 with a term bond due in 2046. The serial coupons range from 3% to 5% with yields from 0.67% to 2.98%. The 2046 bonds have a 5% coupon priced at 118.14 to yield 2.89%.

Proceeds will be used to improve and replace terminals 1, 2, 6, 7 and 8 at the airport, as well as replace elevators and escalators and make other capital improvements.

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