AerCap, CNH, Arch, Niagara Mohawk, UniCredit in primary; credit spreads firm

By Cristal Cody

Tupelo, Miss., June 23 – Investment-grade primary action ramped up on Tuesday following light supply at the start of the week.

AerCap Ireland Capital DAC and AerCap Global Aviation Trust returned to the primary market with $1.25 billion of guaranteed senior notes due Sept. 15, 2023 (Baa3/BBB/BBB-) that priced tighter than talk.

The issuers brought $1.25 billion of 6.5% guaranteed senior notes due July 15, 2025 (Baa3/BBB/BBB-) on June 3.

Arch Capital Group Ltd. priced $1 billion of 30-year senior notes (Baa1/A-/BBB+) better than talk on Tuesday, dropping a 10-year tranche from the final offering.

CNH Industrial Capital LLC sold $600 million of three-year senior notes (Baa3/BBB/BBB-) in a deal upsized from $500 million.

Several other issuers also marketed bonds over the session.

Niagara Mohawk Power Corp. offered two tranches of senior notes (A3/A-), including 10-year notes initially talked to print in the Treasuries plus 150 basis points to 155 bps area and 30-year notes talked at the 185 bps to 190 bps spread area.

Alaska Air Group, Inc. marketed $674,244,000 of pass-through enhanced equipment trust certificates (A/A-) with initial price talk in the low-to-mid 5% area.

Teck Resources Ltd. was expected to price a $500 million offering of 10-year notes with initial guidance in the Treasuries plus 375 bps area.

UniCredit SpA (Baa1/BBB/BBB-) offered 15-year notes on Tuesday. Initial price talk is in the Treasuries plus 510 bps area.

Svenska Handelsbanken AB marketed three-year notes (Aa2/AA-/AA+) in the 75 bps over Treasuries area.

Also on Tuesday, Municipality Finance plc (Aa1/AA+) launched a $1 billion offering of notes due Sept. 1, 2023 at mid-swaps plus 16 bps.

On Monday, new issues were priced from Abbott Laboratories, Canadian Natural Resources Ltd. and Duke Realty LP.

Brookfield Infrastructure Partners, LP postponed a $150 million of $25-par preferred limited partnership units (BBB-) due to market conditions.

Lighter volume of about $25 billion is expected this week following nearly $60 billion of issuance last week.

High-grade credit spreads tightened more than 2 bps on Tuesday after firming nearly 2 bps in the prior session.

The Markit CDX North American Investment Grade 33 index headed out at a spread of 73.76 bps.

Abbott tightens

In the secondary market, new issues were mixed, a source said.

Abbott Laboratories’ $1.3 billion two-part offering of senior notes (A3/A-) firmed about 2 bps across both tranches.

The company sold $650 million of 1.15% notes due Jan. 30, 2028 at 99.37 to yield 1.237%, or a spread of 70 bps over Treasuries.

Initial price talk was in the 100 bps spread area.

The company’s $650 million of 1.4% notes due June 30, 2030 priced at 98.567 to yield 1.555%, or an 85 bps over Treasuries spread.

The notes were talked to print in the 115 bps spread area.

Canadian Natural Resources’ $1.1 billion of senior notes priced in two tranches on Monday traded flat to 3 bps wider than issuance.

The tranche of 2.05% notes due July 15, 2025 was wrapped around issuance in secondary trading.

Canadian Natural Resources (Baa2/BBB) sold $600 million of the five-year notes at 99.832 to yield 2.085%, or a spread of Treasuries plus 175 bps.

Initial price talk was in the 205 bps over Treasuries area.

Canadian Natural Resources’ $500 million of 2.95% notes due July 15, 2030 softened about 3 bps in secondary trading.

The notes priced at 99.955 to yield 2.955%, or Treasuries plus 225 bps.

The 10-year tranche was talked to price at the 255 bps spread area.

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