American Honda, Stancorp sell; syndicate desks prep for busy calendar; tone 'a little better'

By Aleesia Forni and Andrea Heisinger

New York, Aug. 3 - Stancorp Financial Group, Inc. and American Honda Financial Corp. added to the week's list of deals Friday.

Stancorp priced $250 million of 10-year notes to repay senior notes due later in the year.

American Honda sold $500 million of one-year floating-rate notes in line with guidance.

Terms were also given for a hybrid deal sold Thursday by General Electric Capital Corp.

In the preferred stock market, Taubman Centers Inc. priced $175 million of 6.5% series J cumulative redeemable perpetual preferred shares on Friday.

As of late in the day, issuers had priced nearly $18 billion of high-grade bonds during the week, according to data compiled by Prospect News. This total easily beat estimates of between $10 billion and $15 billion. Most of the deals were priced on Monday or Tuesday.

The coming week could be even busier with no regulatory meetings or major economic data causing companies to sit on the sidelines.

"We have a very busy calendar for next week," a market source said late Friday. "Could be a crazy Monday as long as nothing happens over the weekend."

The source added that companies are opting to jump into the U.S. bond market now while rates are at record lows instead of waiting until the fourth quarter.

That source estimated between $10 billion and $15 billion of deals for the week, which a syndicate source later said was conservative.

"We're thinking $15 billion to $20 [billion], probably more in the $15 billion area," she said. "Rates are extremely low, and I know some companies want to get in the market while the tone in Europe's OK."

There's a consensus, the syndicate source said, and "everyone's expecting something to happen in Europe."

"Rates are so low, why wouldn't you [issue now]?" she added.

The secondary market's tone "seemed a little better" on Friday following the jobs report and stock market rally, a market source said.

The Markit CDX Series 18 North American Investment Grade index tightened 5 basis points to a spread of 104 bps.

However, being a "summer Friday," volumes were "light" at $6.6 billion, the trader added.

There seemed to be no big movers in Friday's trading, another trader added, though bank paper traded better. Bonds from JPMorgan Chase & Co. and Merrill Lynch were seen tighter near the end of the session.

American Honda sells at talk

American Honda Finance priced $500 million of one-year floating-rate notes (A1/A+) at par to yield Libor plus 8 bps, a source close to the trade said.

The notes were priced in line with guidance in the Libor plus 8 bps area.

The bookrunners were Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and RBS Securities Inc.

The U.S. financing arm of Honda Financial Services is based in Torrance, Calif.

Stancorp's 10-year

Stancorp Financial Group sold $250 million of 5% 10-year senior notes (Baa2/BBB+/) to yield 350 bps over Treasuries, a market source said.

Barclays, Goldman Sachs & Co. and J.P. Morgan Securities LLC ran the books.

Proceeds are being used to repay up to $250 million of 6.875% 10-year senior notes due Oct. 1, 2012 and for general corporate purposes.

Though one source has not seen any levels on the deal, after hearing it was done on reverse inquiry, the source guessed "all or most were placed."

The holding company for insurance and asset management subsidiaries is based in Portland, Ore.

GE's fixed-to-floaters

General Electric Capital priced $125 million of three-year global fixed-to-floating-rate medium-term notes at par, according to a 424B2 filing with the Securities and Exchange Commission.

The notes have a fixed rate of 1.125% until Aug. 7, 2013 and then a floating rate of Libor plus 52.5 bps until maturity.

Barclays acted as bookrunner.

The financial products and services provider is based in Norwalk, Conn.

Taubman sells preferreds

Taubman Centers' new 6.5% series J cumulative redeemable preferreds were "kind of weak" at $24.68 bid, $24.82 offered, a trader said, though he added that the company's common stock was "doing well."

The $175 million deal was upsized from $75 million and came at the low end of talk.

The trader also noted that the size of the deal indicated that the company will likely be able to redeem in full both its series G and H preferreds.

The 7.625% series H cumulative redeemable preferreds (NYSE: TCOPH) closed down 12 cents at $25.30. The 8% series G cumulative redeemable preferreds (NYSE: TCOPG) ended down a nickel at $25.40.

Taubman will apply to list the new securities on the New York Stock Exchange under the ticker symbol "TCOPJ."

Morgan Stanley & Co. LLC and Wells Fargo Securities LLC were the bookrunners.

JPMorgan tighter

The secondary also saw the $3 billion 6.3% issue due 2019 from JPMorgan tighten 13 bps to 188 bps bid.

JPMorgan priced the 10-year bonds on April 16, 2009 at 305 bps over Treasuries.

Merrill Lynch tightens

The secondary saw Merrill Lynch's 6.875% notes due 2018 widen 3 bps to 309 bps bid near the end of New York's session.

On April 22, 2008, the bank priced $5.5 billion of the 10-year notes at 320 bps over Treasuries.

Stephanie N. Rotondo contributed to this review

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