By Angela McDaniels and Kenneth Lim
Boston, Feb. 8 - Tennessee Valley Authority priced $1.5 billion of 3.875% global power bonds, series A, due Feb. 15, 2021, according to an 8-K filing with the Securities and Exchange Commission.
The spread was 42 basis points over Treasuries, market sources said.
The notes were sold at 99.228 to yield 3.969%. Price talk was at 43 bps over Treasuries.
In a news release, the issuer said the rate was the lowest it has achieved for an institutional offering of 10-year bullet maturity bonds. TVA said it chose the 10-year tenor because of strong demand at that yield.
Bank of America Merrill Lynch, Barclays Capital Inc. and Morgan Stanley & Co. Inc. were the joint bookrunners.
The issuer has applied to list the bonds on the New York Stock Exchange.
Proceeds will be used to refinance debt and for other power system purposes.
TVA is a Knoxville, Tenn.-based provider of electricity.
| Issuer: | Tennessee Valley Authority
|
| Issue: | Global power bonds, series A
|
| Amount: | $1.5 billion
|
| Maturity: | Feb. 15, 2021
|
| Coupon: | 3.875%
|
| Price: | 99.228
|
| Yield: | 3.969%
|
| Spread: | 42 bps over Treasuries
|
| Price talk: | 43 bps over Treasuries
|
| Call option: | Non-callable
|
| Expected ratings: | Moody's: Aaa
|
| Standard & Poor's: AAA
|
| Fitch: AAA
|
| Pricing date: | Feb. 3
|
| Settlement date: | Feb. 8
|
| Bookrunners: | Bank of America Merrill Lynch, Barclays Capital Inc. and Morgan Stanley & Co. Inc.
|
| Cusip: | 880591EL2
|
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