Rogers, Georgia Power, Expedia do upsized deals; Southwestern Energy firms; Duke mixed

By Aleesia Forni and Cristal Cody

New York, Dec. 1 – The new deal frenzy in the high-grade bond market continued on Tuesday, with nine issuers bringing more than $7 billion of paper to market.

A number of the day’s new deals, including those from Rogers Communications Inc., Georgia Power Co. and Expedia, Inc., were increased from initial size thoughts.

December’s opening session pushes the week’s total supply to $16.3 billion, closing in on what was predicted to be a $20 billion week.

And the rest of the week’s pace is expected to remain active, with one source calling for “more of the same” amount of issuance to price on Wednesday.

Investment-grade bonds and credit spreads remained mostly strong on Tuesday.

The Markit CDX North American Investment Grade 25 index opened the session about 1 bp tighter and closed the day 3 bps better at a spread of 81 bps.

In the secondary market, energy names were trading stronger over the session but mostly remain weaker than issuance.

Southwestern Energy Co.’s senior notes (Baa3/BBB-) traded 1 bp to 8 bps better.

Duke Energy Progress Inc.’s first mortgage bonds (Aa2/A/A+) traded 6 bps tighter on the short end to 1 bp softer on the longer end.

ConocoPhillips Co.’s senior notes (A1/A) were flat to tighter in the secondary market.

Marathon Oil Corp.’s senior notes (Baa1/BBB) were mixed over the session.

Synchrony sells $1 billion

Synchrony Financial priced a $1 billion issue of 2.6% three-year senior notes (/BBB-/BBB-) on Tuesday in what one source called a “great trade,” with the offering attracting $2.7 billion of orders.

The notes sold with a spread of Treasuries plus 142 bps, at the tight end of talk set in the Treasuries plus 145 bps area and tighter than initial price thoughts in the 155 bps to 160 bps range over Treasuries.

The notes sold at 99.974 to yield 2.608%.

Citigroup Global Markets Inc., Barclays, Guggenheim Securities and RBC Capital Markets LLC are the bookrunners.

Proceeds will be used to prepay outstanding amounts under the company’s bank term loan facility, to invest in liquid assets to further increase the size of its liquidity portfolio or for other additional uses.

Synchrony is a consumer financial services company based in Stamford, Conn.

Citigroup two-parter

Also on Tuesday, Citigroup Inc. priced a $2 billion offering of three-year fixed- and floating-rate notes (Baa1/A-/A) at the tightest side of guidance, a market source said.

A $1.65 billion 2.05% tranche of notes sold at 99.986 to yield 2.055%, or Treasuries plus 87.5 bps.

The notes were guided in the 90 bps area over Treasuries and initially talked in the Treasuries plus 100 bps area.

A $350 million floating-rate piece sold at par to yield Libor plus 86 bps. Talk was at the Libor equivalent to the fixed-rate tranche.

Citigroup is the bookrunner.

The financial services company is based in New York.

Rogers upsizes

Rogers Communications priced an upsized $1 billion of senior notes (Baa1/BBB+/BBB+) in new and reopened tranches on Tuesday, according to a market source and an FWP filed with the Securities and Exchange Commission.

The offering included a $700 million tranche of 3.625% 10-year notes sold at 99.252 to yield 3.715%, or Treasuries plus 157 bps.

The tranche was guided in the Treasuries plus 160 bps area, having tightened from the Treasuries plus 180 bps area.

Also priced was a $300 million add-on to the company’s existing 5% notes due March 15, 2044 at Treasuries plus 197 bps.

Pricing was at 101.7 to yield 4.887%.

The notes sold at the tight end of the Treasuries plus 200 bps area guidance and tighter than initial price thoughts in the 215 bps area over Treasuries.

The original $750 million issue priced on March 3, 2015 at 150 bps over Treasuries.

Citigroup, J.P. Morgan Securities LLC, Scotia Capital (USA) Inc., TD Securities and BofA Merrill Lynch are the bookrunners.

The notes are guaranteed by Rogers Communications Partnership.

Proceeds will be used to repay a portion of the outstanding advances under bank credit facilities and for general corporate purposes.

Rogers Communications is a Toronto-based communications and media company.

Air Canada equipment notes

In other primary happenings, Air Canada sold a $537,092,000 three-tranche issue of enhanced equipment trust certificates on Tuesday, according to a market source and a company news release.

The company priced $295,022,000 of 3.75% certificates, series 2015-2, class AA (A1/AA) at par with a final expected distribution date of Dec. 15, 2027.

There was also $121,035,000 of 4.125% certificates, series 2015-2, class A (A3/A) priced at par with a final expected distribution date of Dec. 15, 2027.

Finally, it sold $121,035,000 of 5% certificates, series 2015-2, class B (Ba1/BBB-) at par with a final expected distribution date of Dec. 15, 2023.

Each class of certificates will represent an interest in a related pass through trust, with the proceeds to be used to acquire equipment notes to be issued by Air Canada and secured by three Boeing 787-9 aircraft and two Boeing 777-300ER aircraft delivered in April and May 2016.

The Montreal-based airline plans to use the proceeds to finance the acquisition of these new aircraft.

The bookrunners were Citigroup, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and Morgan Stanley & Co. LLC.

Georgia Power new issue

Georgia Power sold an upsized $500 million offering of 1.95% three-year senior notes (A3/A-/A+) on Tuesday at Treasuries plus 80 bps, according to a market source and a filing with the SEC.

The notes were upsized from a planned $300 million.

Pricing was at 99.913 to yield 1.98%.

Guidance was set in the area of Treasuries plus 85 bps after having firmed from initial talk in the 105 bps area over Treasuries.

JPMorgan, Scotia Capital and SunTrust Robinson Humphrey Inc. are the joint bookrunners.

Proceeds from the offering will be used to repay $250 million of the company’s outstanding series Z 5.25% senior notes due Dec. 15, 2015, to repay short-term debt and for general corporate purposes.

The electric utility is based in Atlanta.

Expedia prices tight

Expedia was also in Tuesday’s primary with an upsized $750 million offering of 5% senior notes priced at Treasuries plus 290 bps to help fund its acquisition of HomeAway Inc., according to a market source.

The notes (BBB-/BBB-) were sold at the tight side of guidance in a Rule 144A and Regulation S offering.

Pricing was at 99.535.

The deal was upsized from $400 million.

BofA Merrill Lynch, Goldman Sachs & Co. and JPMorgan were the bookrunners.

Expedia is a Bellevue, Wash.-based online travel company.

EDC green bonds price

Export Development Canada priced $300 million of 1.25% three-year green bonds (Aaa/AAA) on Tuesday at mid-swaps plus 14 bps, according to a market source and an FWP filing with the SEC.

The notes sold in line with guidance set in the mid-swaps plus 14 bps area.

Pricing was at 99.742 to yield 1.338%.

BofA Merrill Lynch, Credit Agricole and Morgan Stanley are the joint bookrunners.

Proceeds will be used for projects that are beneficial to the environment.

The government-backed agency for exporters is based in Ottawa.

Wisconsin utility prices

The primary also hosted Wisconsin Public Service Corp., which sold $250 million of 1.65% three-year senior notes (A1/A-/A+) at Treasuries plus 50 bps, according to an informed source and an FWP filed with the SEC.

The notes sold at 99.907 to yield 1.682%.

Pricing came at the tight side of the Treasuries plus 55 bps area guidance, which firmed from initial talk set in the 70 bps to 75 bps area.

MUFG, Wells Fargo, Mizuho Securities USA Inc. and Scotia Capital are the joint bookrunners.

Proceeds will be used to repay short-term debt and for working capital and other corporate purposes.

The subsidiary of Integrys Energy Group, Inc. is based in Green Bay, Wis.

Southwestern Energy improves

Southwestern Energy’s 4.05% notes due 2020 tightened to 564 bps bid on Tuesday, better than where the notes traded at 572 bps bid on Monday, according to a market source.

The company sold $850 million of the notes on Jan. 20, 2015 at a spread of 278 bps over Treasuries.

Southwestern Energy’s 4.95% notes due 2025 firmed 1 bp to 543 bps bid.

The company sold $1 billion of the notes in the Jan. 20 offering at 318 bps over Treasuries.

The independent natural gas and oil company is based in Houston.

Duke Energy mixed

Duke Energy Progress’ 3.25% notes due 2025 firmed 6 bps in secondary trading to 86 bps bid, according to a market source.

The company sold $500 million of the notes on Aug. 10 at a spread of Treasuries plus 105 bps.

Duke Energy’s 4.2% bonds due 2045 eased 1 bp to 122 bps bid.

Duke Energy placed $700 million of the bonds in the Aug. 10 sale at Treasuries plus 130 bps.

The electricity distributor is based in Raleigh, N.C.

ConocoPhillips flat

ConocoPhillips’ 2.2% notes due 2020 firmed 2 bps to 68 bps bid, according to a market source.

ConocoPhillips sold $500 million of the notes on May 13, 2015 at 65 bps over Treasuries.

The company’s 3.35% notes due 2025 were unchanged at 142 bps bid.

ConocoPhillips priced $500 million of the notes in the May 13 offering at Treasuries plus 110 bps.

The energy company is based in Houston.

Marathon Oil mixed

Marathon Oil’s 3.85% notes due 2025 firmed 2 bps in secondary trading to 305 bps bid, a market source said.

The company sold $900 million of the notes on June 1 at a spread of Treasuries plus 170 bps.

Marathon Oil’s 5.2% bonds due 2045 eased 4 bps to 330 bps bid over the day.

Marathon Oil sold $500 million of the bonds in the June 1 offering at a spread of Treasuries plus 225 bps.

The energy company is based in Houston.

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