Jefferies, Carlyle, sovereigns tap market; ConAgra Foods prices large deal, firms in secondary

By Aleesia Forni and Andrea Heisinger

New York, Jan. 15 - A small number of investment-grade deals were done by corporate names in Tuesday's primary, including those from ConAgra Foods, Inc., Jefferies Group Inc. and Carlyle Holdings Finance LLC.

ConAgra had the largest offering of the day at $3.975 billion in maturities of three, five, 10 and 30 years.

Investor demand was strong for the sale at "more than $19 billion," a source who worked on part of the trade said.

There was an upsized $1 billion of senior notes due 2023 and 2043 sold by Jefferies Group.

Carlyle Holdings, a unit of the Carlyle Group LP, priced $500 million of 10-year notes via Rule 144A and Regulation S. Terms of the sale, done via syndicates Credit Suisse Securities (USA) LLC and J.P. Morgan Securities LLC, were not available at press time.

Several sovereign trades were done in the primary as well.

Germany's KfW priced $1.5 billion of three-year floating-rate notes.

The Development Bank of Japan Inc. sold $1 billion of five-year notes after the offering went overnight from Monday.

Inter-American Development Bank priced $2 billion of five-year notes, also after going overnight.

Local government funding agency Bank Nederlandse Gemeenten sold $1.5 billion of 10-year notes.

A $425 million sale of $25-par 60-year junior subordinated notes was done by NextEra Energy Capital Holdings Inc.

Swedish Export Credit Corp. gave terms of its $500 million sale of floating-rate notes due 2017 that priced on Monday.

There may have been some turbulence in equities, but there was little in the high-grade bond market on the day, a source said.

"We didn't really notice anything," she said.

Wednesday should be somewhat quiet, although there could be "some opportunistic issuers getting in there" on the success of Tuesday's trades, the source said.

The Markit CDX Series 18 North American Investment Grade index was unchanged a spread of 89 basis points.

ConAgra's new notes were performing better near the end of Tuesday's session, tightening 9 bps to 12 bps before the day's close.

Meanwhile, Monday's four-tranche issuance from Anheuser-Busch InBev Finance Inc. traded mostly wider during the session.

ConAgra prices large deal

ConAgra Foods was in the market with a $3.975 billion sale of senior notes (Baa2/BBB/) in four tranches, a market source said.

A $750 million tranche of 1.3% three-year notes sold at a spread of Treasuries plus 95 bps. Pricing was at the tight end of talk in the 100 bps area.

The notes tightened 10 bps to 85 bps bid, 84 bps offered.

There was $1 billion of 1.9% five-year bonds priced at a spread of 115 bps over Treasuries. The notes sold at the low end of guidance in the 120 bps area.

The five-year notes firmed 9 bps to 106 bps bid, 103 bps offered.

The third part was $1.225 billion of 3.2% 10-year notes sold at Treasuries plus 140 bps. The tranche sold tighter than talk in the 145 bps area.

The trader quoted the 10-year notes at 128 bps bid, 127 bps offered late in the session.

Finally, there was $1 billion of 4.65% 30-year bonds priced at 165 bps over Treasuries. Pricing was at the tight end of guidance in the 170 bps area.

The notes were trading 9 bps better at 156 bps bid, 154 bps offered.

Bookrunners for the three-year notes were RBS Securities Inc., Bank of America Merrill Lynch, J.P. Morgan Securities LLC and U.S. Bancorp Investments Inc. Those for the five-year notes were Wells Fargo Securities LLC, JPMorgan, Bank of America and BNP Paribas Securities Corp.

Bookrunners for the 10-year tranche were Bank of America, JPMorgan, Wells Fargo and Mitsubishi UFJ Securities (USA) Inc. The 30-year bonds had bookrunners JPMorgan, Bank of America, Mitsubishi UFJ and Mizuho Securities USA Inc.

Proceeds are being used to fund the pending acquisition of Ralcorp Holdings, Inc. totaling about $6.8 billion including the assumption of debt.

There is a mandatory call at 101 if the acquisition is not done by Aug. 26.

ConAgra is an Omaha-based maker of prepared foods.

Jefferies sells $1 billion

Jefferies Group priced an upsized $1 billion of senior notes (Baa3/BBB/BBB) in two maturities , a market source said.

The size was initially $750 million, the source said.

A $600 million tranche of 5.125% 10-year notes sold at a spread of Treasuries plus 332.5 bps.

The second part was $400 million of 6.5% 30-year bonds priced at a spread of 357.5 bps over Treasuries.

Bookrunner was Jefferies & Co.

Proceeds are being used to pre-fund $250 million of 5.875% senior notes due in 2014, with $350 million to fund the required redemption by Jefferies High Yield Holdings LLC of two series of outstanding non-controlling membership interests. Any remainder will be used for general corporate purposes.

Jefferies was last in the U.S. bond market with a reopening of 6.875% notes due 2021 to add $200 million on April 19, 2012.

The global investment bank is based in New York City.

KfW's short floaters

Germany's KfW sold $1.5 billion of three-year floating-rate global notes (Aaa/AAA/AAA) on Tuesday at par to yield one-month Libor plus 5 bps, a market source told Prospect News.

Bookrunners were Bank of America Merrill Lynch, Morgan Stanley & Co. LLC and RBC Capital Markets LLC.

The notes from the Frankfurt-based development bank are guaranteed by the Republic of Germany.

Development Bank of Japan deal

Development Bank of Japan did a $1 billion sale of 1% five-year notes on Tuesday to yield mid-swaps plus 24 bps, or Treasuries plus 36 bps, an informed source said.

Pricing was in line with guidance of mid-swaps plus the low 20 bps area.

The notes (Aa3/AA-/) were priced at 99.52.

Bookrunners were Bank of America Merrill Lynch, J.P. Morgan Securities LLC and HSBC Securities (USA) Inc.

The financial services and investment company is based in Tokyo.

IADB sells $2 billion

The Inter-American Development Bank has priced $2 billion of 0.875% five-year notes (Aaa/AAA/) at a spread of mid-swaps plus 1 bp, a market source away from the trade said.

Bookrunners were Goldman Sachs & Co., Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, HSBC Securities (USA) Inc., TD Securities (USA) LLC, Bank of America Merrill Lynch, Commonwealth Bank of Australia, Daiwa Securities and DZ Bank.

The provider of development financing for Latin America and the Caribbean is based in Washington, D.C.

BNG brings 10-years

Bank Nederlandse Gemeenten priced $1.5 billion of 2.5% 10-year bonds (Aaa/AAA/AAA) to yield mid-swaps plus 70 bps, or Treasuries plus 73.25 bps, under Rule 144A and Regulation S, a market source said.

Bookrunners were Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs International and J.P. Morgan Securities LLC.

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

SEK gives deal terms

Swedish Export Credit priced an upsized $500 million of floating-rate notes due 2017 (Aaa/AAA/) at par to yield Libor plus 30 bps, according to an FWP filing with the Securities and Exchange Commission.

The size was increased from $250 million.

Goldman Sachs International and J.P. Morgan Securities LLC were bookrunners.

The lender to Sweden's export industry is based in Stockholm.

Next Era's $25-par

NextEra Energy Capital Holdings priced $425 million of 5% 60-year series J junior subordinated debentures.

The $25-par notes will be unconditionally and irrevocably guaranteed by NextEra Energy Inc.

Price talk is around 5%, according to a trader.

The trader quoted the issue at $24.72 bid, $24.77 offered in the gray market as of midafternoon.

After pricing, a trader said the deal was "doing well," seeing paper at $24.70 in the gray.

Bank of America Merrill Lynch, Citigroup Global Markets Inc., Morgan Stanley & Co. Inc., UBS Securities LLC and Wells Fargo Securities LLC are the joint bookrunning managers.

The company will apply to list the notes on the New York Stock Exchange.

Proceeds from the sale will be added to the general fund. NextEra expects to use said funds to repay a portion of commercial paper obligations and for general corporate purposes.

NextEra is a Juno Beach, Fla.-based energy services provider.

Anheuser-Busch widens

The secondary market saw Anheuser-Busch InBev's $1 billion tranche of 0.8% three-year notes trade 1 bps weaker at 44 bps bid, 41 bps offered.

The notes were sold with a spread of Treasuries plus 43 bps.

In other trading, the $1 billion tranche of 1.25% five-year notes was seen 3 bps wider at 63 bps bid, 60 bps offered following its sale with a spread of 60 bps over Treasuries.

The $1.25 billion of 2.625% 10-year notes traded 1 bp weaker on Tuesday.

A trader quoted the notes at 86 bps bid, 83 bps offered. The notes were priced at a spread of Treasuries plus 85 bps.

Meanwhile, the $750 million tranche of 4% 30-year bonds was flat at a 100 bps bid, 97 bps offered following Monday's pricing with a spread of Treasuries plus 100 bps.

The brewery is based in Leuven, Belgium.

Stephanie N. Rotondo contributed to this review

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