Published on 4/26/2022 in the Prospect News Investment Grade Daily.
New Issue: Anthem sells $1.3 billion of notes due 2032, 2052
By Cristal Cody
Chicago, April 26 – Anthem, Inc. sold $1.3 billion of notes in two parts (Baa2/A/BBB) on Tuesday, according to a 424B3 filing, a FWP filing and additional details from a market source.
The company priced $600 million of 4.1% 10-year notes at 99.77 to yield 4.128%. Pricing with a spread of 135 basis points over Treasuries, the notes came low to talk in the 155 bps area.
Additionally, Anthem sold $700 million of 4.55% 30-year notes at 99.462 to yield 4.583%. The spread was 170 bps over the relevant benchmark Treasury, versus talk in the 190 bps area.
The 10-year notes will have an optional make-whole call at Treasuries plus 25 bps until three months before the maturity date when the notes will be callable at par.
Likewise, the 30-year notes have a make-whole call at Treasuries plus 30 bps until six months before the maturity date when the par call starts.
Morgan Stanley & Co. LLC and Wells Fargo Securities LLC led the sale. Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC, Mizuho Securities USA LLC and U.S. Bancorp Investments, Inc. are also listed as joint bookrunners.
Proceeds will be used for working capital and for general corporate purposes, including, funding of acquisitions, repayment of short-term and long-term debt, and repurchase of common stock under the company’s share repurchase program.
Indianapolis-based Anthem is a health benefits company.
| Issuer: | Anthem, Inc.
|
| Amount: | $1.3 billion
|
| Issue: | Notes
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| Bookrunners: | Morgan Stanley & Co. LLC, Wells Fargo Securities LLC, Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC, Mizuho Securities USA LLC and U.S. Bancorp Investments, Inc.
|
| Senior co-managers: | Barclays Capital Inc., BofA Securities, Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC, PNC Capital Markets LLC and Truist Securities, Inc.
|
| Junior co-managers: | BNY Mellon Capital Markets, LLC and Huntington Securities, Inc.
|
| Trustee: | Bank of New York Mellon Trust Co., NA
|
| Counsel to issuer: | Hogan Lovells US LLP and Drinker Biddle & Reath LLP
|
| Counsel to underwriters: | Davis Polk & Wardwell LLP
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| Change of control: | At 101
|
| Trade date: | April 26
|
| Settlement date: | April 29
|
| Ratings: | Moody’s: Baa2
|
| S&P: A
|
| Fitch: BBB
|
| Distribution: | SEC registered
|
|
|
| 10-year notes
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| Amount: | $600 million
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| Maturity: | May 15, 2032
|
| Coupon: | 4.1%
|
| Price: | 99.77
|
| Yield: | 4.128%
|
| Spread: | Treasuries plus 135 bps
|
| Call features: | Make-whole call at Treasuries plus 25 bps until Feb. 15, 2032, then at par
|
| Price talk: | Treasuries plus 155 bps area
|
| Cusip: | 036752AT0
|
|
|
| 30-year notes
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| Amount: | $700 million
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| Maturity: | May 15, 2052
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| Coupon: | 4.55%
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| Price: | 99.462
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| Yield: | 4.583%
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| Spread: | Treasuries plus 170 bps
|
| Call features: | Make-whole call at Treasuries plus 30 bps until Nov. 15, 2051; then at par
|
| Price talk: | Treasuries plus 190 bps area
|
| Cusip: | 036752AU7
|
|
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