AT&T sells $1.15 billion; Schwab, Synovus tap primary market; high-grade spreads ease

By Cristal Cody

Tupelo, Miss., Oct. 25 – High-grade securities deal action on Wednesday included offerings from AT&T Inc., Charles Schwab Corp. and Synovus Financial Corp.

AT&T priced $1.15 billion of global notes due Nov. 1, 2066.

Charles Schwab sold $500 million of depositary shares that represent 1/100th of an interest in fixed-to-floating rate preferred stock.

Synovus Financial sold $300 million of five-year senior notes.

In other activity, Freddie Mac announced it would not issue notes on its Oct. 25 announcement date.

The Markit CDX North American Investment Grade 29 index eased more than 1 basis point on Wednesday to a spread of 54 bps.

AT&T prices $1.15 billion

AT&T priced $1.15 billion of 5.35% $25-par global notes due Nov. 1, 2066 on Wednesday, according to a market source and an FWP filing with the Securities and Exchange Commission.

The notes were initially talked to price in the 5.375% to 5.5% area.

The bookrunners were BofA Merrill Lynch, Morgan Stanley & Co. LLC, Wells Fargo Securities LLC, RBC Capital Markets, LLC and UBS Securities LLC.

The deal includes an over-allotment option of $172.5 million.

AT&T expects to apply to list the notes on the New York Stock Exchange.

Proceeds will be used for general corporate purposes.

AT&T is a Dallas-based telecommunications company.

Schwab raises $500 million

Charles Schwab on Wednesday priced $500 million of depositary shares (Baa2/BBB/BB+), which each represent 1/100th of an interest in 5% series F fixed-to-floating rate non-cumulative perpetual preferred stock, according to a market source and an FWP filing with the SEC.

The preferreds were initially talked to price in the 5.125% area.

The preferreds will have a fixed rate to but excluding Dec. 1, 2027 and then will convert to a floating rate of Libor plus 257.5 bps.

Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Goldman Sachs & Co., J.P. Morgan Securities LLC, BofA Merrill Lynch and Wells Fargo were the bookrunners.

The securities will not be listed on an exchange.

Proceeds will be used for general corporate purposes, including redeeming the company’s series B preferreds and the depositary shares representing an interest in a series B preferred.

Schwab is a brokerage and financial services company based in San Francisco.

Synovus sells notes

Synovus Financial sold $300 million of 3.125% five-year senior notes (BBB-/BBB-) on Wednesday at a spread of 112.5 bps over Treasuries, according to an FWP filing with the SEC.

The notes priced at 99.729 to yield 3.184%.

The bookrunner was BofA Merrill Lynch.

Proceeds will be used with cash on hand to redeem all $300 million of the company’s notes due 2019 on Nov. 9 and for general corporate purposes.

Synovus is a financial services company based in Columbus, Ga.

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