Canada, Google, Whirlpool deals price tight; Eli Lilly joins primary; Google eases, then firms

By Aleesia Forni and Cristal Cody

Virginia Beach, Feb. 20 - Canada, Google Inc., Whirlpool Corp. and Eli Lilly & Co. led a flood of issuance for the high-grade primary market on Thursday.

Canada was in the day's market with a $3 billion issue of 1.625% senior notes due 2019, which priced at 11 basis points over Treasuries.

The notes sold on top of talk, which had tightened twice from earlier guidance.

Meanwhile, Google came to market with its second ever bond offering on Thursday.

The company sold $1 billion of 3.375% 10-year senior notes at 62.5 bps over Treasuries, an informed source said.

The notes priced at the tight end of talk, which was set in the area of Treasuries plus 65 bps.

Whirlpool came to market with an $800 million issue of senior notes in three tranches.

The sale included a $250 million tranche of 1.35% three-year notes sold at 65 bps over Treasuries and a $250 million tranche of 2.4% notes due 2019 sold at Treasuries plus 90 bps. A $300 million tranche of 4% 10-year notes sold at Treasuries plus 125 bps.

All three tranches priced at the tight end of talk.

Meanwhile, Eli Lilly priced $1 billion of notes in two tranches.

The company sold $600 million of 1.95% notes due 2019 at Treasuries plus 45 bps and $400 million of 4.65% 30-year bonds at 95 bps over Treasuries.

Germany's Erste Abwicklungsanstalt sold $1.75 billion of 1% three-year notes at 99.862 to yield 1.047%, or mid-swaps plus 22 bps, according to a syndicate source.

The notes sold in line with guidance.

Nederlandse Waterschapsbank NV tapped its existing floaters due Feb. 14, 2018 to add $150 million.

The tap priced at 100.004 to yield Libor plus 23 bps, wide of the Libor plus 22 bps talk.

The session also saw Medtronic, Inc. price $2 billion of notes in three parts, though full details were not available at press time.

New issues traded mostly better, while investment-grade bond spreads tightened over the day, market sources said.

The Markit CDX North American Investment Grade series 21 index firmed 1 bp to a spread of 65 bps.

Google's 3.375% notes 2024 initially widened 1½ bps in aftermarket trading but tightened late afternoon, according to traders.

Whirlpool's three tranches of notes priced late with only the three-year note active in aftermarket trading, traders said. Whirlpool's 1.35% notes due 2017 firmed 2 bps in the secondary market.

Eli Lilly's notes tightened on the offered side in secondary trading, a trader said.

Medtronic's new tranches of notes were active going out, according to a trader. Medtronic's notes due 2017 were quoted at 20 bps bid, 17 bps offered. The notes due 2024 were seen at 87 bps bid, 84 bps offered, while the tranche of bonds due 2044 traded at 92 bps bid, 89 bps offered.

Canada sells $3 billion

Canada priced $3 billion of 1.625% senior notes (Aaa/AAA/AAA) due 2019 with a spread of 11 bps over Treasuries, according to a syndicate source and an FWP filing with the Securities and Exchange Commission.

The notes sold on top of talk.

Pricing was at 99.842 to yield 1.658%.

Guidance was previously set at 12 bps over Treasuries, at the tight end of earlier guidance of 12 bps to 14 bps over Treasuries.

J.P. Morgan Securities LLC, RBC Capital Markets LLC, Scotia Capital and HSBC Securities (USA) Inc. were the bookrunners.

The issue will provide funds to supplement and diversity Canada's foreign exchange reserves.

Canada was last in the U.S. high-grade market on Feb. 7, 2012 when it sold $3 billion of 0.875% global notes due 2017 to yield Treasuries plus 8 bps.

Google prices tight

Google priced a $1 billion issue of 3.375% senior notes due 2024 with a spread of Treasuries plus 62.5 bps during Thursday's session, according to an informed source and an FWP filed with the Securities and Exchange Commission.

The notes (Aa2/AA/) sold at the tight end of talk.

Pricing was at 99.983 to yield 3.377%.

Google's 3.375% notes 2024 eased after pricing to 64 bps bid, 63 bps offered and later tightened to 61 bps bid, 69 bps offered in aftermarket trading, according to traders.

The bookrunners were Goldman Sachs & Co., BofA Merrill Lynch and Morgan Stanley & Co. LLC.

Proceeds are being used for general corporate purposes, which may include the repayment of the company's 1.25% notes due 2014.

The technology company is based in Mountain View, Calif.

Eli Lilly two-parter

Eli Lilly sold $1 billion of senior notes (A2/AA-/) in two parts on Thursday, according to a syndicate source and an FWP filing with the SEC.

The sale included $600 million of 1.95% notes due 2019 sold with a spread of Treasuries plus 45 bps, or at 99.827 to yield 1.985%.

A second tranche was $400 million of 4.65% 30-year bonds priced at 95 bps over Treasuries.

The notes sold at 99.861 to yield 4.657%.

Eli Lilly's 1.95% notes due 2019 firmed in the secondary market to 41 bps offered, a trader said.

The 4.65% notes due 2044 went out at 92 bps offered.

BofA Merrill Lynch, Barclays, Citigroup Global Markets Inc. and Morgan Stanley were the joint bookrunners.

The company expects to use proceeds from the sale of the notes for general corporate purposes, including the repayment of its $1 billion 4.2% notes due March 6, 2014.

The pharmaceutical company is based in Indianapolis.

Whirlpool new issue

Whirlpool priced $800 million of senior notes (Baa2/BBB/BBB) in tranches due 2017, 2019 and 2024 on Thursday, according to a market source.

A $250 million tranche of 1.35% three-year notes priced at 99.947 to yield 1.368%, or 65 bps over Treasuries.

There was also a $250 million tranche of 2.4% notes due 2019, which sold with a spread of Treasuries plus 90 bps. Pricing was at 99.774 to yield 2.448%.

Finally, $300 million of 4% notes due 2024 sold at 99.893 to yield 4.013%, or Treasuries plus 125 bps.

All three tranches priced at the tight end of talk.

Whirlpool's 1.35% notes due 2017 tightened to 63 bps bid in the secondary market, a trader said.

Active bookrunners were JPMorgan and RBS Securities Inc., while BNP Paribas Securities Corp. and Citigroup were the passive bookrunners.

Proceeds will be used for general corporate purposes, including repayment of $100 million of 6.45% Maytag medium-term notes that mature in August 2014 and $500 million of 8.6% senior notes that mature in May 2014.

Whirlpool is a Benton Harbor, Mich.-based appliance maker.

EAA prices three-years

Germany's Erste Abwicklungsanstalt priced on Thursday a $1.75 billion issue of 1% notes due 2017 at 99.862 to yield 1.047%, or mid-swaps plus 22 bps, according to a syndicate source.

The notes were guided in the low 20 bps area over mid-swaps.

Barclays, BofA Merrill Lynch, Citigroup, Goldman Sachs and Daiwa Securities are the joint bookrunners.

The public law agency is charged with winding up portfolios transferred to it and is based in Dusseldorf.

Waterschapsbank adds on

Nederlandse Waterschapsbank priced a $150 million tap of its existing floating-rate notes (Aaa/AA+/) due Feb. 14, 2018 at 100.004 to yield Libor plus 23 bps, according to a market source.

Talk was set at Libor plus 22 bps.

HSBC Securities and RBS managed the Rule 144A and Regulation S sale.

The original $350 million issue priced at par on Feb. 7.

The issuer provides loans to municipalities and other public programs and is based in the Hague, the Netherlands.

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