Ford Credit Canada sells C$500 million; Ville de Quebec notes go fast; roadshows underway

By Cristal Cody

Prospect News, Feb. 1 - Ford Credit Canada Ltd. came near the session close on Wednesday with an offering of C$500 million of five-year notes, a day after Ford Motor Credit Co. LLC was in the U.S. market with a $1 billion issue of five-year notes.

"Well oversubscribed," one source said of Ford Credit Canada's sale. "The deal went really well."

Details also emerged on Wednesday from Ville de Quebec's offering of C$70 million of debentures.

Ville de Quebec sold C$70 million of one-year to five-year serial and 10-year debentures through a competitive sale, a bond source said on Wednesday.

"The issue is selling quickly to institutional investors across Canada and in the United States," the source said.

Activity in the Canadian markets stayed mostly quiet until the late afternoon deal from Ford Credit Canada, sources said.

Primary activity should pick up in February.

"We do have a number of roadshows in the calendar upcoming," a syndicate source said.

Alberta energy company Capital Power LP is holding a fixed income non-deal roadshow this week, the source said.

Ontario-based Calloway Real Estate Investment Trust is expected to hold a non-deal roadshow in the week ahead.

While both are official non-deal roadshows, they hold the potential for bond sales, the source said.

In the secondary market on Wednesday, bonds traded flat to slightly better.

The Markit CDX Series 17 North American investment-grade index firmed 1 basis point to a spread of 100 bps.

Government bonds were mixed and traded lower on the short end. Canada's 10-year note yield fell 1 bp to 1.9%. The 30-year bond yield closed 1 bp lower at 2.41%.

The Bank of Canada auctioned C$2.5 billion of 2.75% 10-year notes to strong demand at an average yield of 2.015%, the lowest since 1998.

Ford Credit Canada prices

Ford Credit Canada sold C$500 million of notes due Feb. 8, 2017 at par to yield 4 7/8% late afternoon, in line with price talk, according to bond sources.

The notes (Ba1/BB+/DBRS: BB) priced at a spread of 355.2 bps over the Government of Canada benchmark, compared to guidance of 350 bps to 355 bps area.

RBC Capital Markets Corp. was the lead manager. Co-managers were Bank of Nova Scotia, BMO Capital Markets Corp. and CIBC World Markets Inc.

The deal, not eligible for sale outside Canada, has a call feature of 88.5 bps over the Canadian benchmark.

The notes are guaranteed by Ford Motor Credit Co. LLC.

On Tuesday, Ford Motor Credit sold $1 billion of five-year senior notes (Ba1/BB+/BB+) in the U.S. high-yield market at par to yield 4¼%.

Ford Credit Canada is the Canadian financing arm of Ford Motor Co.

Ville de Quebec wraps sale

Ville de Quebec was back in the market with an offering of C$70 million of one-year to five-year serial and 10-year debentures, a bond source said on Wednesday.

The five-year line of serial maturities from Feb. 14, 2013 through Feb. 14, 2017 priced at a spread of 47 bps versus the Province of Quebec curve.

The debentures due 2022 priced at a spread of 50 bps versus the Quebec bond curve.

The deal priced through a competitive sale.

CIBC World Markets Inc. was the winning bidder.

The auction marks the fifth consecutive winning bid for CIBC World Markets in Ville de Quebec's competitive debt sales.

The Quebec city was in the market last in November with an offering of C$65 million of one-year to five-year serial and 10-year debentures.

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