Bank of America, Lowe’s, Morgan Stanley price; Japan Agency plans deal; AT&T tightens

By Cristal Cody

Tupelo, Miss., April 19 – Pricing action stayed strong on Wednesday in the high-grade bond market with new deals from Bank of America Corp., Lowe’s Cos., Inc., Morgan Stanley and Basin Electric Power Cooperative.

Bank of America priced a $6.75 billion four-part offering of notes.

Lowe’s sold $3 billion of notes in two tranches.

Morgan Stanley tapped the primary market with a $1.75 billion offering of seven-year floating-rate senior notes.

Basin Electric Power Cooperative placed $500 million of 30-year first mortgage bonds in a Rule 144A and Regulation S offering on Wednesday.

In other deal action, Japan International Cooperation Agency is marketing dollar-denominated guaranteed bonds expected to price on Thursday.

The Markit CDX North American Investment Grade index was mostly unchanged on Wednesday at a spread of 69 basis points.

AT&T Inc.’s 4.25% notes due March 1, 2027 firmed about 4 bps in the secondary market over the session.

Verizon Communications Inc.’s 4.125% notes due March 16, 2027 traded about 1 bp better.

BofA prices $6.75 billion

Bank of America priced $6.75 billion of notes (Baa1/BBB+/A) in four tranches on Wednesday, according to a market source.

Bank of America sold $1.5 billion of six-year floating-rate notes at Libor plus 100 bps.

The $1.25 billion tranche of 2.881% six-year fixed/floating-rate notes priced at a spread of Treasuries plus 115 bps.

The company sold $2 billion of 3.705% 11-year notes at a spread of 150 bps over Treasuries.

Bank of America sold $2 billion of 4.244% 21-year fixed/floating-rate notes at a spread of Treasuries plus 137 bps.

The notes priced on the tight side of guidance.

BofA Merrill Lynch was the bookrunner.

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

Lowe’s prices on tight side

Lowe’s sold $3 billion of notes (A3/A-/) in two parts on Wednesday, according to a market source and an FWP filed with the Securities and Exchange Commission.

Lowe’s sold $1.5 billion of 3.1% notes due May 3, 2027 at 99.846 to yield 3.118% and a spread of Treasuries plus 90 bps. The notes were talked to price at a spread in the Treasuries plus 95 bps area, plus or minus 5 bps.

The company sold $1.5 billion of 4.05% notes due May 3, 2047 at 99.364 to yield 4.087%. The 30-year notes priced with a spread of Treasuries plus 120 bps, on the tight side of guidance in the Treasuries plus 125 bps area, plus or minus 5 bps.

BofA Merrill Lynch, J.P. Morgan Securities LLC and SunTrust Robinson Humphrey Inc. were the bookrunners.

The Mooresville, N.C.-based home improvement company will use the proceeds to finance a tender offer to purchase for cash up to $1.6 billion of existing notes, to repay at maturity $250 million of 6.1% notes due Sept. 15, 2017 and for other general corporate purposes.

Morgan Stanley sells floaters

Morgan Stanley sold $1.75 billion of seven-year floating-rate senior notes (A3/BBB+/A) at par to yield Libor plus 122 bps on Wednesday, according to a market source and an FWP filing with the SEC.

The series I global medium-term notes due May 8, 2024 were talked to price at the Libor plus 125 bps area, plus or minus 3 bps.

Morgan Stanley & Co. LLC was the bookrunner.

Morgan Stanley is a New York-based financial products and services company.

Basin Electric brings bonds

Basin Electric Power Cooperative priced $500 million of 4.75% 30-year series A first mortgage bonds (A3/A/A) in a Rule 144A and Regulation S offering on Wednesday at a spread of 190 bps over Treasuries, according to a market source.

The notes due April 26, 2047 priced on the tight side of guidance in the Treasuries plus 195 bps area, plus or minus 5 bps.

MUFG, RBC Capital Markets, LLC and U.S. Bancorp Investments, Inc. were the bookrunners.

Proceeds will be used for general corporate purposes.

Basin Electric Power Cooperative is an electric generation and transmission cooperative based in Bismarck, N.D.

Japan Agency talks notes

Looking ahead to Thursday’s supply, the Japan International Cooperation Agency (/A+/) plans to sell guaranteed bonds that are talked to price in the mid-swaps plus 65 bps area, according to a market source and a 424B5 filed with the SEC on Wednesday.

The non-callable global notes due April 27, 2027 will be guaranteed by Japan.

BofA Merrill Lynch, BNP Paribas Securities Corp. and Mizuho Securities USA Inc. are the bookrunners.

Proceeds from the offering may be allocated for investments in one or more eligible projects.

Japan International Cooperation Agency is a Japanese government-owned agency that promotes international cooperation and development of Japanese and global economies.

AT&T tightens

In the secondary market, AT&T’s 4.25% notes due March 1, 2027 tightened about 4 bps on Wednesday to 170 bps bid, according to a market source.

The company priced $2 billion of the notes (Baa1/BBB+/A-) on Jan. 31 at a spread of Treasuries plus 180 bps.

AT&T is a Dallas-based telecommunications company.

Verizon better

Verizon Communications’ 4.125% notes due March 16, 2027 firmed about 1 bp to head out at 155 bps bid, a source said.

Verizon sold $3.25 billion of the notes (Baa1/BBB+/A-) on March 13 at a spread of Treasuries plus 160 bps.

The telecommunications company is based in New York City.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.