Starbucks, RBS, Eni, Florida Light in primary market; inflows decline; Bristol-Myers eyed

By Cristal Cody

Tupelo, Miss., May 2 – High-grade corporate issuers priced $5.25 billion of notes over Thursday’s session.

Starbucks Corp. sold $2 billion of senior notes in two tranches.

The Royal Bank of Scotland Group plc priced $1.25 billion of 11-year fixed-to-floating-rate senior notes.

Eni SpA brought $1 billion of 10-year senior notes to the primary market.

Florida Power & Light Co. placed $1 billion of three-year floating-rate notes.

In the sovereign, supranational and agency space, Nederlandse Waterschapsbank NV priced $500 million of 18-month floating-rate notes.

Investment-grade volume week to date totals more than $22 billion, compared to the $15 billion to $20 billion of deal volume expected by market sources for the week.

Lipper US Fund Flows on Thursday reported corporate investment-grade fund inflows slowed to $375 million for the week ended May 1 from last week’s second largest inflow on record of $5.86 billion.

In other action, Bristol-Myers Squibb Co. began a two-day round of fixed income investor calls on Thursday for an eight-tranche Rule 144A and Regulation S offering of dollar-denominated notes.

T-Mobile U.S. Inc. also is continuing a roadshow that began on Tuesday and will end May 8 for an upcoming bond offering to fund its acquisition of Sprint Corp. The deal size is projected in the mid-$30 billion range.

In the secondary market, new issues priced this week were mixed with several issuers softer, according to market sources on Thursday.

Boeing Co.’s $3.5 billion five-tranche offering of senior notes priced on Tuesday earlier were quoted about 1 basis point to 3 bps tighter on the shorter maturities to 1 bp to 2 bps softer on the longer-dated tranches.

The Markit CDX North American Investment Grade 32 index ended the day at a spread of 58 bps.

Starbucks prices $2 billion

Starbucks priced $2 billion of senior notes (Baa1/BBB+/BBB+) in two tranches on Thursday on the firm side of guidance, according to a market source and an FWP filing with the Securities and Exchange Commission.

The company sold $1 billion of 3.55% 10-year notes at 99.774 to yield 3.577%. The notes were sold with a spread of 103 bps over Treasuries.

A $1 billion tranche of 4.45% 30-year green notes priced at 99.824 to yield 4.461%, or a Treasuries plus 153 bps spread.

Citigroup Global Markets Inc., Morgan Stanley & Co. LLC, U.S. Bancorp Investments Inc., Wells Fargo Securities LLC and BofA Merrill Lynch were the bookrunners.

Starbucks is a Seattle-based specialty coffee retailer.

RBS sells fixed/floaters

Royal Bank of Scotland Group priced $1.25 billion of 4.445% fixed-to-floating-rate senior notes due May 8, 2030 (Baa2/BBB-/A) on Thursday at par to yield a spread of 190 bps over Treasuries, according to an FWP filing with the SEC.

The notes have a fixed rate until May 8, 2029 and then will reset to a floating rate of Libor plus 187.1 bps to but excluding the maturity.

Citigroup Global Markets, J.P. Morgan Securities LLC, NatWest Markets Securities Inc. and UBS Securities LLC were the bookrunners.

Royal Bank of Scotland Group is a banking and financial services company based in Edinburgh, Scotland.

Florida Power prints $1 billion

Florida Power & Light priced $1 billion of floating-rate notes due May 6, 2022 (A1/A-/A+) at par to yield Libor plus 40 bps on Thursday, according to a market source and an FWP filing with the SEC.

Price guidance was in the Libor plus 40 bps to 43 bps area. The notes were initially talked to price in the Libor plus 55 bps to 60 bps area.

The rate will be reset quarterly beginning Aug. 6.

Citigroup Global Markets, Morgan Stanley, RBC Capital Markets LLC, U.S. Bancorp Investments, Wells Fargo Securities, Fifth Third Securities Inc. and Regions Securities LLC were the bookrunners.

Florida Power & Light is a Juno Beach, Fla.-based electric utility.

Eni raises $1 billion

Eni (Baa1/A-/A-) priced $1 billion of 4.25% 10-year senior notes with a spread of Treasuries plus 173 bps in a Rule 144A and Regulation S offering on Thursday, according to a market source.

The notes priced on the tight side of guidance in the Treasuries plus 175 bps area.

Bookrunners included Citigroup Global Markets, Goldman Sachs & Co. LLC, J.P. Morgan Securities, BofA Merrill Lynch, HSBC Securities (USA) Inc., Morgan Stanley and Wells Fargo Securities.

The oil and gas company is based in Rome.

NWB Bank sells notes

Nederlandse Waterschapsbank priced $500 million of 18-month floating-rate notes in a Rule 144A and Regulation S offering on Thursday at Libor plus 1 bp, according to a market source.

The notes due Nov. 10, 2020 (Aaa/AAA/) were initially talked to price in the Libor plus 1 bp area.

BNP Paribas Securities Corp. and Scotia Capital (USA) Inc. were the lead managers.

The local government funding agency is based in The Hague, the Netherlands.

Bristol-Myers’ deal ahead

Bristol-Myers Squibb (A2/A+/A-) is marketing eight tranches of senior notes (A2/A+/) with maturities spread across the curve.

The Rule 144A and Regulation S deal is expected to include 1.5-, two-, three-, five-, seven-, 10-, 20- and 30-year tranches, a source said.

The notes were given an A2 rating by Moody’s Investors Service and an A+ rating by S&P Global Ratings on Thursday.

Bristol-Myers Squibb began a two-day session of fixed income investor calls on Thursday for the dollar-denominated notes.

Barclays, Credit Suisse Securities (USA) LLC, Morgan Staley & Co. LLC and Wells Fargo Securities are the arrangers.

The offering is targeted in the $10 billion to $15 billion area and is expected to price in the week ahead.

Bristol-Myers Squibb said in a news release that proceeds will be used to fund a portion of its acquisition of Celgene Corp. with any remaining proceeds to be used for general corporate purposes.

The companies announced the cash and stock transaction valued at about $74 billion in January.

The merger is expected to close in the third quarter.

Bristol-Myers Squibb and Celgene are biopharmaceutical companies based in New York and Summit, N.J., respectively.

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