Microsoft, MPLX, KeyBank tap market; Goldman Sachs, Bank of America paper tightens

By Cristal Cody

Tupelo, Miss., Feb. 9 – Investment-grade issuance stayed strong out of the gate on Monday with new deals brought by Microsoft Corp., MPLX LP and KeyBank NA, market sources said.

Microsoft priced a $10.75 billion six-part offering of notes.

MPLX sold $500 million of 4% 10-year senior notes at a spread of Treasuries plus 210 basis points.

KeyBank was in the primary market with a $1 billion five-year senior notes offering.

Credit spreads and high-grade bonds remained mostly firm on Monday, sources said.

The Markit CDX North American Investment Grade index ended unchanged at a spread of 66 bps.

The new deal from MPLX tightened 12 bps in aftermarket trading.

In other trading, Goldman Sachs Group Inc.’s 3.85% notes due 2024 improved from Friday, along with Bank of America Corp.’s 4% notes due 2024.

Microsoft prices $10.75 billion

Microsoft sold $10.75 billion of notes in a six-part offering on Monday, according to a market source.

The company priced $1.5 billion of 1.85% notes due Feb. 12, 2020 at a spread of Treasuries plus 35 bps. The notes came on the tight side of talk of 37 bps, plus or minus 2 bps.

A $1.5 billion tranche of 2.375% notes due Feb. 12, 2022 priced at Treasuries plus 60 bps. The notes priced tighter than guidance of 62 bps, plus or minus 2 bps.

Microsoft placed $2.25 billion of 2.7% notes due Feb. 12, 2025 at 75 bps over Treasuries, on the tight side of guidance of 77 bps, plus or minus 2 bps.

In the fourth tranche, Microsoft sold $1.5 billion of 3.5% notes due Feb. 12, 2035 at 103 bps over Treasuries. The notes were talked at 105 bps, plus or minus 2 bps.

The company brought $1.75 billion of 3.75% notes due Feb. 12, 2045 at Treasuries plus 123 bps. The notes came tighter than guidance of 125 bps, plus or minus 2 bps.

Finally, Microsoft priced $2.25 billion of 4% notes due Feb. 12, 2055 at a spread of 153 bps over Treasuries. The notes were guided at 155 bps, plus or minus 2 bps.

Barclays and Citigroup Global Markets Inc. were joint bookrunners.

Proceeds will be used for general corporate purposes.

The computer software company is based in Redmond, Wash.

MPLX prices $500 million

MPLX sold $500 million of 4% 10-year senior notes at 99.64 to yield 4.044% on Monday, according to an FWP filing with the Securities and Exchange Commission and a market source.

The notes due Feb. 15, 2025 priced with a spread of Treasuries plus 210 bps.

In secondary trading, the notes tightened to 198 bps offered, a trader said.

Barclays, BNP Paribas Securities Corp., Goldman Sachs & Co., Fifth Third Securities, Inc., PNC Capital Markets LLC, Scotia Capital (USA) Inc. and US Bancorp. were the bookrunners.

Proceeds will be used to repay debt outstanding under the company’s revolving credit facility and for general partnership purposes.

MPLX is a Findlay, Ohio-based owner, operator and developer of crude oil pipeline and midstream assets in the United States.

Goldman improves

Goldman Sachs’ 3.85% notes due 2024 (Baa1/A-/A) traded about 8 bps tighter from Friday’s market at 127 bps bid, a source said.

Goldman Sachs sold $2.25 billion of the notes on June 30, 2014 at Treasuries plus 135 bps.

The financial services company is based in New York City.

Bank of America firms

Bank of America’s 4% notes due 2024 tightened to 121 bps bid from 129 bps bid on Friday, a market source said.

Bank of America sold $2.75 billion of the notes on March 27, 2014 at Treasuries plus 137 bps.

The financial services company is based in Charlotte, N.C.

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