Stryker, Applied Materials, Microchip, Kellogg, Interstate Power price; spreads firm

By Cristal Cody

Tupelo, Miss., May 26 – The investment-grade primary market filled up quickly on Tuesday following the long Memorial Day holiday weekend with more than a handful of issuers offering bonds.

Stryker Corp. priced $2.3 billion of notes in three tranches.

Applied Materials, Inc. sold $1.5 billion of senior notes in two tranches.

Microchip Technology Inc. priced $1 billion of long three-year senior secured notes (Baa3/existing BB+/BBB-) and launched $1.2 billion of long five-year senior unsecured notes (Ba2//BB+) on Tuesday.

Kellogg Co. sold $500 million of 10-year senior notes.

Interstate Power and Light Co. priced $400 million of 10-year senior debentures.

Bank holding company Hancock Whitney Corp. sold $150 million of $25-par 6.25% 40-year notes in a deal upsized from $100 million and priced on the tight side of talk in the 6.25% to 6.375% area.

Also, Pembina Pipeline Corp. kept Canadian supply active with C$500 million of senior medium-term notes (BBB//DBRS: BBB) priced in two tranches on Tuesday.

Additional deals were marketed over the day with final pricing terms not available by press time.

Citigroup Inc. offered 11-year fixed-to-floating rate senior notes (A3/BBB+/A) with initial price talk in the Treasuries plus 215 basis points area.

Wells Fargo & Co. marketed two tranches of medium-term senior redeemable fixed-to-floating rate notes (A2/A-/A+) that included four-year notes talked to price at the Treasuries plus 175 bps area and eight-year notes talked at the 215 bps over Treasuries area.

Swedbank AB (Aa3/A+/A+) offered dollar-denominated three-year notes that were talked to print in the Treasuries plus 135 bps area.

Also on Tuesday, Total Capital International offered 30-year guaranteed notes (Aa3/A+) that were talked to price at the 205 bps spread area.

About $25 billion to $30 billion of deal volume is expected by market participants this week.

More than $52 billion of investment-grade bonds were priced last week, beating market forecasts of about $30 billion to $40 billion of supply.

The Markit CDX North American Investment Grade 33 index closed Tuesday about 5 bps tighter from Friday at a spread of 82.24 bps.

Stryker raises $2.3 billion

Stryker priced $2.3 billion of notes (Baa1/A-) in three tranches on Tuesday, according to a market source and an FWP filing with the Securities and Exchange Commission.

The company sold $650 million of 1.15% five-year notes at 99.766 to yield 1.198%, or a spread of Treasuries plus 85 bps.

The five-year notes were talked to print in the 115 bps over Treasuries area.

A $1 billion tranche of 1.95% 10-year notes priced at a 130 bps over Treasuries spread, or 99.611 to yield 1.993%.

The 10-year notes were talked at the 155 bps spread area.

Stryker sold $650 million of 2.9% 30-year notes at 99.701 to yield 2.915% and with a Treasuries plus 150 bps spread.

Initial guidance was in the 180 bps spread area.

BofA Securities Inc., Citigroup Global Markets Inc., Wells Fargo Securities LLC, Barclays, BNP Paribas Securities Corp., Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC were the bookrunners.

Stryker is a Kalamazoo, Mich.-based medical technology company.

Applied Materials prices

Applied Materials priced $1.5 billion of senior notes (A3/A-) in two tranches on Tuesday, according to a market source and an FWP filing.

A $750 million offering of 1.75% 10-year notes priced at 99.617 to yield 1.792%, or a spread of Treasuries plus 110 bps.

The 10-year tranche was talked in the Treasuries plus 150 bps area.

Applied Materials sold $750 million of 2.75% 30-year notes at 99.533 to yield 2.773%, or Treasuries plus 135 bps over Treasuries.

The 30-year tranche was talked at the 175 bps spread area.

BofA Securities, Goldman Sachs, J.P. Morgan Securities LLC, Citigroup, Mizuho Securities USA Inc., MUFG, U.S. Bancorp Investments Inc. and Wells Fargo were the bookrunners.

Applied Materials is a Santa Clara, Calif., manufacturer of semiconductor equipment.

Kellogg sells notes

Kellogg sold $500 million of 2.1% 10-year senior notes (Baa2/BBB) on Tuesday at a spread of 143 bps over Treasuries, according a market source and an FWP filing.

Initial guidance was in the Treasuries plus 175 bps area.

The notes priced at 99.731 to yield 2.13%.

Barclays, BofA Securities and Morgan Stanley were the bookrunners.

The Battle Creek, Mich.-based company manufactures cereal and convenience foods.

Interstate Power prints

Interstate Power and Light priced $400 million of 2.3% 10-year senior debentures (Baa1/A-) on Tuesday at 99.575 to yield 2.348%, or a spread of Treasuries plus 165 bps, according to a market source and an FWP filing.

Initial talk was in the Treasuries plus 205 bps area.

Goldman Sachs, Mizuho and MUFG were the bookrunners.

The electric and natural gas subsidiary of Alliant Energy Corp. is based in Cedar Rapids, Iowa.

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