AbbVie, Chevron, Burlington Northern, Grainger price; bonds mixed; credit spreads mostly flat

By Cristal Cody

Eureka Springs, Ark., May 9 – Investment-grade primary action roared to life on Monday with issuance heavy in the non-financial sector.

AbbVie Inc. priced $7.8 billion of senior notes in five tranches.

Chevron Corp. sold $6.8 billion of senior notes in six parts over the day.

Burlington Northern Santa Fe, LLC brought $750 million of 30-year senior debentures.

Waste Management, Inc. priced $500 million of seven-year senior notes.

W.W. Grainger, Inc. printed $400 million of 30-year senior notes during the session.

Duke Energy Indiana, LLC tapped the market with a $500 million sale of 30-year first mortgage bonds.

About $45 billion or more of high-grade volume is expected over the week.

In the secondary market, BNP Paribas SA’s 5.2% notes due 2026 were seen 2 basis points tighter earlier in the day.

Time Warner Inc.’s 2.95% notes due 2026 traded 1 bp better.

General Motors Financial Co. Inc.’s 3.7% senior notes due 2023 were flat to 1 bp weaker.

The Markit CDX North American Investment Grade series 23 index ended the day mostly unchanged at a spread of 85 bps.

AbbVie prices $7.8 billion

AbbVie brought to market a $7.8 billion five-part offering of senior notes on Monday, according to a market source and a 424B3 filed with the Securities and Exchange Commission.

The company sold $1.8 billion of 2.3% five-year notes with a spread of 120 bps over Treasuries.

The $1 billion tranche of 2.85% seven-year notes priced at 135 bps plus Treasuries.

AbbVie sold $2 billion of 3.2% 10-year notes with a spread of 150 bps over Treasuries.

The company placed $1 billion of 4.3% 20-year bonds at Treasuries plus 175 bps.

Lastly, AbbVie sold $2 billion of 4.45% 30-year bonds at 190 bps plus Treasuries.

BofA Merrill Lynch, Barclays, Deutsche Bank Securities Inc. and J.P. Morgan Securities LLC were the bookrunners.

Proceeds will be used to fund the cash component of the Stemcentrx Inc. acquisition, to finance share repurchases, to repay the company’s outstanding term loan maturing in November 2016 and for general corporate purposes.

The biopharmaceutical company is based in Abbott Park, Ill.

Chevron brings $6.8 billion

Chevron sold $6.8 billion of senior notes (Aa2/AA-) in six tranches on Monday, according to a market source and a 424B3 filing with the SEC.

The company sold $850 million of two-year floating-rate notes at Libor plus 50 bps.

The $1.35 billion tranche of 1.561% three-year notes priced with a spread of Treasuries plus 70 bps.

A planned three-tranche offering of floating-rate notes was dropped.

Chevron priced $250 million of five-year floating-rate notes at Libor plus 95 bps.

The $1.35 billion tranche of 2.1% five-year notes were sold with a spread of 90 bps over Treasuries.

The company priced $750 million of 2.566% seven-year notes at 105 bps over Treasuries.

The final tranche of $2.25 billion of 2.954% 10-year notes priced at 120 bps plus Treasuries.

BofA Merrill Lynch, JPMorgan and Wells Fargo Securities LLC were the bookrunners.

Proceeds will be used for general corporate purposes, including refinancing a portion of commercial paper.

The petroleum, chemical, mining, power and energy company is based in San Ramon, Calif.

Burlington Northern prices

Burlington Northern Santa Fe sold $750 million of 3.9% 30-year senior debentures at 99.199 to yield 3.945% on Monday, according to an FWP filing with the SEC.

The debentures (A3/A) priced with a spread of 133 bps over Treasuries.

Citigroup Global Markets Inc., Goldman Sachs & Co. and JPMorgan were the bookrunners.

Proceeds will be used for general corporate purposes.

The holding company for railroad transportation subsidiaries is based in Fort Worth, Texas.

Waste Management sells bonds

Waste Management sold $500 million of 2.4% seven-year senior notes at 99.898 to yield 2.416% on Monday, according to an FWP filing with the SEC.

The notes (Baa2/A-/BBB) priced with a spread of 90 bps over Treasuries.

Citigroup, BofA Merrill Lynch and Mizuho Securities USA Inc. were the bookrunners.

The notes are guaranteed by Waste Management Holdings, Inc.

Proceeds, along with cash on hand, will be used to repay $500 million of the company’s outstanding 2.6% senior notes due in September. The company may temporarily use the proceeds to pay down short-term borrowings under its $2.25 billion revolving credit facility used for working capital and to invest in short-term investments.

Waste Management is a Houston-based provider of waste collection, transfer, recycling and resource recovery and disposal services.

Grainger prints $400 million

W.W. Grainger sold $400 million of 3.75% 30-year senior notes on Monday at 99.322 to yield 3.788%, according to a market source and an FWP filing with the SEC.

The notes priced with a spread of 117 bps over Treasuries. The bonds were talked at Treasuries plus 120 bps, plus or minus 3 bps.

Morgan Stanley & Co. LLC, HSBC Securities (USA) Inc. and Wells Fargo were the bookrunners.

Proceeds will be used to repay commercial paper bearing a weighted average interest rate of 0.49% and maturing in less than 10 days.

The industrial supply company is based in Lake Forest, Ill.

Duke Energy in primary market

Duke Energy Indiana sold $500 million of 3.75% 30-year first mortgage bonds with a spread of 115 bps over Treasuries on Monday, according to an FWP filing with the SEC.

The bonds (Aa3/A/A) priced at 99.731 to yield 3.765%.

Credit Suisse Securities (USA) LLC, Goldman Sachs, Mizuho and U.S. Bancorp Investments, Inc. were the lead managers.

Proceeds will be used for general corporate purposes, including to repay $325 million of 6.05% debentures due June 15, 2016 and $150 million of series VVV floating-rate first mortgage bonds due July 11, 2016.

The electric subsidiary of Duke Energy Corp. is based in Plainfield, Ind.

BNP Paribas tightens

BNP Paribas’ 5.2% notes due 2026 were quoted 2 bps tighter at 263 bps offered early Monday, according to a market source.

BNP Paribas sold $1.25 billion of the notes (/BBB+/A) on Thursday at a spread of 265 bps plus Treasuries.

The banking and financial services company is based in Paris.

Time Warner firms

Time Warner’s 2.95% notes due 2026 firmed 1 bp to 136 bps offered, a market source said.

Time Warner sold $800 million of the notes (Baa2//BBB+) on Thursday at 135 bps over Treasuries.

The media and entertainment company is based in New York.

General Motors active

General Motors’ 3.7% notes due 2023 traded flat to 1 bp softer at 221 bps offered, according to a market source.

The company sold $1.2 billion of the notes (/BBB-/BBB-) on Wednesday at a spread of Treasuries plus 220 bps.

General Motors Financial is the Fort Worth-based finance subsidiary of General Motors Co.

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