Union Pacific, Total Capital, Mondelez, DTE, Commonwealth Edison tap primary; Verizon slips

By Cristal Cody

Tupelo, Miss., Feb. 11 – High-grade issuers kicked the week off with strong volume on Monday and more offerings eyed for Tuesday.

Union Pacific Corp. sold $3 billion of fixed-rate senior notes in four tranches.

Total Capital International priced a $1.25 billion offering of 10-year guaranteed notes.

Mondelez International, Inc. brought $600 million of seven-year notes to the market.

DTE Electric Co. raised $650 million in an offering of 30-year general and refunding mortgage bonds.

Commonwealth Edison Co. sold $400 million of 30-year first mortgage bonds during the session.

Coming up on Tuesday, the Bank of England intends to tap the primary market with a $2 billion offering of three-year notes.

Also, BNG Bank NV plans a $250 million reopening of its senior floating-rate notes due March 11, 2022 that were first priced in April 2018.

In other primary market action, Altria Group Inc. launched a four-part offering of euro-denominated notes on Monday. The company also may price dollar-denominated notes after holding a roadshow in the United States and Europe last week, a source said.

Investment-grade supply is expected to ramp up this week with about $25 billion to $30 billion of overall volume predicted following light issuance last week, sources said. High-grade issuers brought more than $10 billion of bonds to the market in the past week.

The Markit CDX North American Investment Grade 31 index was quoted at a spread of 68 basis points on Monday.

In the secondary market, Verizon Communications Inc.’s 3.875% green bonds due Feb. 8, 2029 priced last week traded about 4 bps softer on the day.

BP Capital Markets America Inc.’s 4.234% guaranteed senior notes due Nov. 6, 2028 (A1/A-/), reopened on Wednesday, were unchanged from Friday.

Union Pacific sells four tranches

Union Pacific sold $3 billion of fixed-rate senior notes (A3/A-/) in four tranches on on the tight side of guidance Monday, according to a market source.

A $500 million tranche of 2.95% three-year notes priced at a spread of 50 bps over Treasuries.

Union Pacific sold $500 million of 3.15% five-year notes with a spread of Treasuries plus 70 bps.

A $1 billion tranche of 3.7% 10-year notes priced at a Treasuries plus 105 bps spread.

Also, a $1 billion tranche of 4.3% 30-year notes priced with a 135 bps over Treasuries spread.

Barclays, Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC were the bookrunners.

The railroad transportation company is based in Omaha.

Total Capital prints $1.25 billion

Total Capital International priced $1.25 billion of 3.455% 10-year guaranteed notes (Aa3/A+/) at par to yield a spread of 80 bps over Treasuries on Monday, according to an FWP filing with the Securities and Exchange Commission.

Goldman Sachs & Co. LLC, Morgan Stanley, MUFG, SG Americas Securities LLC, BBVA Securities Inc. and Credit Suisse Securities were the bookrunners.

The notes are unconditionally guaranteed by parent company Total SA.

Total Capital is a financing arm of the Courbevoie, France-based oil and gas company.

Mondelez sells seven-year note

Mondelez International priced $600 million of 3.625% seven-year notes (Baa1/BBB/) on Monday at 99.462 to yield 3.713%, according to an FWP filing with the SEC.

The notes priced with a spread of Treasuries plus 115 bps.

Deutsche Bank Securities Inc., BofA Merrill Lynch, Goldman Sachs and SG Americas Securities were the bookrunners.

Mondelez is a chocolate, candy and snack company with global headquarters in Deerfield, Ill. The company’s U.S. business is based in East Hanover, N.J.

DTE Electric brings bonds

DTE Electric priced $650 million of 3.95% 30-year general and refunding mortgage bonds (Aa3/A/A+) on Monday at a spread of 100 bps over Treasuries, according to a market source and an FWP filed with the SEC.

The bonds priced at 99.198 to yield 3.996%.

Barclays, BNY Mellon Capital Markets, LLC, J.P. Morgan Securities and BofA Merrill Lynch were the bookrunners.

The electric company is based in Allentown, Pa.

The electric utility is a subsidiary of Detroit-based DTE Energy Co.

Commonwealth Edison prices

Commonwealth Edison sold $400 million of 4% 30-year first mortgage bonds (A1/A-/A) at a spread of Treasuries plus 105 bps on Monday, according to an FWP filing with the SEC.

The first mortgage bonds due March 1, 2049 came at 99.186 to yield 4.047%.

Barclays, MUFG, U.S. Bancorp Investments Inc., CIBC World Markets Corp., Credit Agricole Securities (USA) Inc. and SMBC Nikko Securities America, Inc. were the bookrunners.

Commonwealth Edison is a unit of Chicago-based energy provider Exelon Corp.

Bank of England plans deal

The Bank of England plans to price $2 billion of notes due Feb. 22, 2022 (Aa2/AA/AA) in a Rule 144A and Regulation S offering on Tuesday, according to a market source.

Initial price talk was in the mid-swaps plus 5 bps area.

BofA Merrill Lynch, Barclays, Goldman Sachs & Co. LLC and J.P. Morgan Securities are the bookrunners.

London-based Bank of England is the central bank of the United Kingdom.

BNG Bank to print add-on

BNG Bank NV (Aaa/AAA/AA+) plans to price a $250 million add-on to its senior floating-rate notes due March 11, 2022 on Tuesday, according to a market source.

The notes were initially talked to price with a yield in the Libor plus 5 bps area.

Citigroup Global Markets Inc. and Goldman Sachs & Co. LLC are the bookrunners of the Rule 144A- and Regulation S-eligible transaction.

BNG Bank originally sold $500 million of the notes in line with guidance on April 5, 2018 at Libor plus 7 bps.

The banking services company is based in The Hague, Netherlands.

Verizon weakens

Verizon Communications’ 3.875% notes due Feb. 8, 2029 (Baa1/BBB+/A-) softened in the secondary market to 124 bps bid on Monday, according to a market source.

The notes were quoted wrapped around issuance on Friday at 120 bps bid.

Verizon sold $1 billion of the bonds on Tuesday at a spread of Treasuries plus 120 bps.

The telecommunications company is based in New York City.

BP Capital steady

BP Capital Markets’ add-on to its 4.234% notes due Nov. 6, 2028 were unchanged from Friday at 94 bps bid in secondary trading, a market source said.

The issue was reopened on Wednesday in a $1 billion tranche at a Treasuries plus 92 bps spread.

BP Capital originally sold $1 billion of the 10-year notes on Nov. 1 at par to yield a Treasuries plus 110 bps spread. The total outstanding is now $2 billion.

The notes are guaranteed by London-based parent oil and gas company BP plc.

BP Capital Markets America is a Chicago-based aviation and marine fuels provider.

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