Eksportfinans sets deal terms; week ahead top-heavy; utilities firm; Hewlett-Packard wider

By Andrea Heisinger and Cristal Cody

New York, Aug. 27 - No new deals priced Friday to end an otherwise steady week in the high-grade bond primary market.

Eksportfinans ASA gave terms for a small deal of floaters that priced on Thursday. The company priced $100 million of one-year paper.

The week ahead should have a fair amount of deals, at least in the first three days, sources said. Issuance is expected to die down or cease altogether after Wednesday.

"I have four potential trades," one syndicate source said. "I think it's a matter of feeling out the tone on Monday and Tuesday, and even Wednesday is on the table."

Unlike the past week, the deals are not expected to be monopolized by one sector, in this case, utilities.

"I would say they'll be across multiple sectors," the source said.

Another market source agreed, although she said she wasn't seeing any trades for Monday.

"I am hearing it will be low volume until after Labor Day," the market source said.

The syndicate source said that anyone who doesn't price their bonds in the first couple of days due to the tone or other reasons will have plenty of company after the holiday weekend.

"We're going to see more of a post-Labor Day rush," the source said.

Secondary muted

Friday was mostly a quiet day for corporate debt compared to Treasuries.

"Secondary seems slow," one trader said. "There's a lot of focus on the Treasuries markets."

A huge sell-off in Treasuries sent yields up after Federal Reserve chairman Ben Bernanke indicated on Friday that no immediate additional bond purchases were in the works.

The yield on the 10-year note jumped to 2.64% from 2.48%. The yield on the 30-year bond rose to 3.69% from 3.51%.

Trading flows in the high-grade secondary market have been light compared to primary flows, a second trader said.

"So many bonds are at a premium and the new issue ones are coming at par. People want current coupon par bonds as opposed to big premium bonds with 120 or 125 dollar prices," the trader said.

Corporate bonds still are holding a "positive tone," the trader said. "There's been solid new issuance all month that hasn't widened spreads dramatically, so there's plenty of cash to absorb all these new issues."

In secondary trading on Friday, several utility bonds priced over the week were "all tighter from their recent wides," another trader said. "The utility sector has held in well despite the recent issuance."

Bonds in the energy sector, though, "leaked wider" on the day, the trader said.

Volume was noticeably light, several sources said.

Overall investment-grade Trace volume slid 34% to $7 billion, according to a market source.

Hewlett-Packard Co.'s notes widened on the light trading day after the company upped its takeover bid for 3Par Inc. to $1.88 billion to best Dell Inc.'s offer, according to a source.

Eksportfinans gives terms

Eksportfinans priced $100 million of one-year floating-rate notes at par to yield one-month Libor plus 7 basis points, according to a 424B2 filing with the Securities and Exchange Commission.

Barclays Capital Inc. was the bookrunner.

The issuer provides financial services to Norway's export and municipal sectors and is based in Oslo.

FPL tightens on offer side

FPL Group Capital Inc.'s notes were tighter on the offer side in the secondary market, a trader said.

The company priced $400 million of 2.6% five-year debentures (Baa1/BBB+/A-) on Thursday to yield Treasuries plus 125 bps.

The bonds were seen trading early Friday on light flow at 125 bps bid, 121 bps offered, the trader said.

The electric subsidiary of NextEra Energy is based in Juno Beach, Fla.

Georgia Power flattens

Georgia Power Co.'s new notes were flat in trading after recovering some ground from weaker trading, according to sources.

The utility priced $500 million of 4.75% 30-year series 2010C senior unsecured notes (A3/A/A+) on Thursday at 125 bps over Treasuries.

"It had widened out 5 points and now it's pretty much unchanged from issue pricing," a trader said.

The bonds were seen late Thursday offered at 123 bps, but no activity was seen on Friday, another trader said.

The electric subsidiary of the Southern Co. is based in Atlanta.

Southern California Edison tighter

Southern California Edison Co.'s 4.5% first and refunding mortgage bonds due 2040, series 2010B, firmed in the secondary market on Friday, a source said.

The bonds (A1/A/A+) were sold on Wednesday at 100 bps over Treasuries.

"They're trading pretty well - 5 basis points tighter," the source said.

The electric subsidiary of Edison International is based in Rosemead, Calif.

San Diego Gas widens

San Diego Gas & Electric Co. sold $500 million of 4.5% 30-year first mortgage bonds, series III, (Aa3/A+/AA) at Treasuries plus 88 bps on Monday.

"That's a little bit wide. It came in at 88 and now is 90, 86," a trader said.

The utility subsidiary of Sempra Energy is based in San Diego.

HP widens on bid for 3Par

Hewlett-Packard's notes widened on light secondary trading on Friday after the company upped its takeover bid for 3Par to $1.88 billion to best Dell's offer.

The Palo Alto, Calif.-based technology company's 6% global notes due 2013 were weaker.

"They were offered yesterday at 46 and were offered at 49 today," the trader said. "That seems to be the case on all the issues."

Round Rock, Texas-based computer maker Dell's investment-grade debt was mostly unchanged in secondary trading.

The company's 4.7% notes due 2013 have stayed flat at 49 bps, the trader said.

Hewlett-Packard raised its offer for the Fremont, Calif.-based data storage company to $30.00 a share after Dell matched its previous bid of $27.00 a share.

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