Bank of America, BP Capital, Enbridge among issuers; credit spreads firm; Abbott tightens

By Cristal Cody

Eureka Springs, Ark., Nov. 21 – Several companies tapped the investment-grade bond market on Monday. Most of the holiday week’s offerings are expected to price over the first two sessions, according to market sources.

Bank of America Corp. priced $2 billion of 11-year medium-term subordinated notes, dropping a floating-rate tranche from the final sale.

BP Capital Markets plc brought $2 billion of notes in two tranches.

Enbridge Inc. came with a $1.5 billion two-part offering of senior notes.

Also, New York State Electric & Gas Corp. sold $500 million of 10-year senior notes on Monday.

About $5 billion to $10 billion of volume is expected over the Thanksgiving Day holiday week.

The Markit CDX North American Investment Grade index tightened about 1 basis point to end at a spread of 76 bps on Monday.

In the secondary market, Abbott Laboratories’ 3.75% senior notes due 2026 were seen about 4 bps tighter earlier in the day.

Chevron Phillips Chemical Co. LLC’s new 3.4% senior notes due 2026 were quoted trading about 2 bps to 3 bps softer from Friday.

BofA sells $2 billion

Bank of America priced $2 billion of 4.183% 11-year medium-term subordinated notes (Baa3/BBB/A-) at par on Monday, according to a market source and an FWP filing with the Securities and Exchange Commission.

The series L notes due Nov. 25, 2027 priced with a spread of 185 bps over Treasuries, on the tight side of guidance.

BofA Merrill Lynch was the bookrunner.

Proceeds will be used for general corporate purposes.

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

BP Capital prices $2 billion

BP Capital Markets priced $2 billion of notes (A2/A-) in two tranches on Monday, according to a market source.

The company sold $1.2 billion of 4.183% seven-year notes at a spread of Treasuries plus 110 bps.

BP Capital priced $800 million of 3.723% 12-year notes at a spread of 140 bps over Treasuries.

The notes priced on the tight side of guidance.

BofA Merrill Lynch, Citigroup Global Markets Inc., BNP Paribas Securities Corp., Credit Suisse Securities (USA) LLC, Goldman Sachs & Co. and MUFG were the bookrunners.

BP Capital Markets is a financing arm of London-based oil and gas company BP plc.

Enbridge raises $1.5 billion

Enbridge priced $1.5 billion of senior notes (Baa2/BBB+/) in two parts on Monday, according to a market source and an FWP filing with the SEC.

The company sold $750 million of 4.25% 10-year notes at 99.356 to yield 4.33% and a spread of 200 bps plus Treasuries.

Enbridge priced $750 million of 5.5% 30-year notes at 99.606 to yield 5.527%. The bonds were sold with a 250 bps spread over Treasuries.

Both tranches priced on the tight side of talk.

Barclays, Deutsche Bank Securities Inc., Mizuho Securities USA Inc., MUFG, BNP Paribas and SMBC Nikko Securities America, Inc. were the bookrunners.

Proceeds will be used for capital projects, to reduce debt and for other general corporate purposes.

Enbridge Gas is a Toronto-based natural gas distribution company.

New York Electric sells bonds

New York State Electric & Gas sold $500 million of 3.25% 10-year senior notes on Monday at a spread of 100 bps over Treasuries, according to a market source.

The notes (A3/A-/A-) are due Dec. 1, 2026.

BofA Merrill Lynch, Mizuho, MUFG and RBC Capital Markets, LLC were the bookrunners.

Proceeds will be used to refinance the company’s $100 million of 5.65% senior notes due Dec. 15, 2016, to redeem $96.85 million of auction-rate pollution control obligations on Dec. 19, 2016, to pay down notes payable to affiliates and for general corporate purposes.

The energy utility is based in Binghamton, N.Y.

Abbot improves

Abbott Laboratories’ 3.75% notes due 2026 traded better at 149 bps offered in the secondary market, a source said early Monday.

The notes (Baa3/A+) traded on Friday at 156 bps bid, 153 bps offered.

Abbott Laboratories sold $3 billion of the notes on Thursday at a spread of 155 bps over Treasuries.

The pharmaceutical health-care products company is based in Abbott Park, Ill.

Chevron Phillips eases

Chevron Phillips Chemical’s 3.4% senior notes due 2026 softened to 110 bps offered in secondary trading, a source said earlier in the day.

The notes (A2/A-/) were quoted on Friday at 109 bps bid, 107 bps offered.

The company sold $700 million of the 10-year notes on Thursday at a spread of 115 bps plus Treasuries.

Chevron Phillips Chemical is a Woodlands, Texas-based petrochemical company owned by Chevron Corp. and Phillips 66.

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