Sherwin-Williams, Unilever, Barclays, Constellation Brands price; Great Plains Energy firms

By Cristal Cody

Tupelo, Miss., May 2 – Corporate issuance was the focus in the investment-grade bond market on Tuesday.

Sherwin-Williams Co. priced a $6 billion five-part offering of senior notes.

Unilever Capital Corp. sold $3.15 billion of senior notes in four parts.

Barclays Bank plc tapped the primary market with a $2 billion offering of subordinated notes.

Constellation Brands Inc. placed $1.5 billion of senior notes in three tranches.

Also, Mid-America Apartments, LP priced $600 million of 10-year senior notes, and Public Service Electric & Gas Co. priced $425 million of 10-year secured medium-term notes.

The Markit CDX North American Investment Grade index closed modestly tighter at a spread of 63 basis points.

In secondary action on Tuesday, Great Plains Energy Inc.’s notes (Baa3/BBB/) priced in March traded 1 bp to 5 bps tighter.

Sherwin-Williams prices

Sherwin-Williams priced $6 billion of senior notes (Baa3/BBB/BBB) in five tranches on Tuesday, according to a market source.

The company sold $1.5 billion of 2.25% three-year notes with a spread of 80 bps over Treasuries.

Sherwin-Williams sold $1.25 billion of 2.75% five-year notes at Treasuries plus 95 bps.

The $500 million tranche of seven-year notes priced with a 3.125% coupon and a spread of Treasuries plus 105 bps.

In the 10-year tranche, Sherwin-Williams sold $1.5 billion of 3.45% notes with a Treasuries plus 120 bps spread.

The final tranche of $1.25 billion 4.5% 30-year notes priced with a spread of 155 bps over Treasuries.

The notes all priced on the tight side of guidance.

Citigroup Global Markets Inc., Wells Fargo Securities LLC, J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and PNC Capital Markets LLC were the bookrunners.

The notes are redeemable at the greater of a make-whole call and a par call, according to a 424B5 filing with the Securities and Exchange Commission.

Proceeds will be used to finance the purchase price of the company’s planned acquisition of Valspar Corp.

Sherwin-Williams is a Cleveland-based developer, manufacturer and distributor of paints and related products.

Unilever sells $3.15 billion

Unilever Capital sold $3.15 billion of senior notes (A1/A+/A+) in four tranches on Tuesday, according to a market source.

The company priced $800 million of 1.8% three-year notes at a spread of Treasuries plus 47 bps.

Unilever sold $850 million of 2.2% five-year notes at a Treasuries plus 57 bps spread.

The company placed $500 million of 2.6% seven-year notes with a spread of 67 bps over Treasuries.

Unilever also brought $1 billion of 2.9% 10-year notes at a Treasuries plus 80 bps spread.

Deutsche Bank Securities Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC were the bookrunners.

The notes are guaranteed unconditionally by Unilever NV, Unilever plc and Unilever United States, Inc., according to a 424B3 filed with the Securities and Exchange Commission.

The 2022 notes are callable at the greater of a make-whole call and a par call. The other notes will feature a make-whole call and then a par call.

Proceeds will be used for Unilever's previously announced share buy-back program and for general corporate purposes.

The U.S. office of the Dutch and English consumer goods company is based in Englewood Cliffs, N.J.

Barclays taps market

Barclays Bank sold $2 billion of 4.836% subordinated notes (Baa3/BBB-/A-) at par on Tuesday to yield a spread of Treasuries plus 255 bps, according to a market source.

The deal saw strong demand with a final book size of $6.75 billion.

Barclays was the bookrunner.

Proceeds will be used for general corporate purposes.

Barclays Bank is a banking and financial services company based in London.

Constellation Brands notes

Constellation Brands priced $1.5 billion of senior notes (Baa3/BBB-/BBB-) in three fixed-rate tranches on Tuesday, according to FWP filings with the Securities and Exchange Commission.

The company sold $500 million of 2.7% five-year notes at 99.782 to yield 2.747% and a spread of Treasuries plus 93 bps.

Constellation Brands priced $500 million 3.5% 10-year notes at 99.766 to yield 3.528%, or Treasuries plus 123 bps.

In the final tranche, the company brought $500 million of 4.5% 30-year notes at 99.559 to yield 4.527%. The bonds priced with a Treasuries plus 153 bps spread.

The bookrunners were BofA Merrill Lynch, J.P. Morgan Securities LLC, Goldman Sachs & Co. and MUFG.

The Victor, N.Y.-based wine company plans to use the proceeds to repay all $700 million outstanding 7.25% senior notes due 2017 and repay a portion of debt under the company’s U.S. term A loan.

Mid-America Apartments prints

Mid-America Apartments placed $600 million of 3.6% 10-year senior notes (Baa1/BBB+/BBB+) on Tuesday at 99.58 to yield 3.65%, according to an FWP filing with the SEC.

The notes priced with a spread of 135 bps over Treasuries.

Wells Fargo Securities LLC, Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Jefferies LLC and U.S. Bancorp Investments Inc. were the bookrunners.

Proceeds will be used to repay a portion of the approximately $570 million of debt outstanding under the company’s $1 billion revolving credit facility and for general corporate purposes.

Mid-America Apartments is a Memphis-based real estate investment trust.

PSE&G sells notes

Public Service Electric & Gas priced $425 million of series L secured medium-term notes due May 15, 2027 with a spread of 73 bps over Treasuries, according to a market source on Tuesday.

The notes (Aa3/A/A-) priced on the tight side of guidance in the Treasuries plus 75 bps area, plus or minus 2 bps.

BNP Paribas Securities Corp., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Goldman Sachs & Co., Mizuho Securities USA Inc., Scotia Capital (USA) Inc. and Williams Capital Group LP were the bookrunners.

The notes have a make-whole call until Feb. 15, 2027 and then a par call, according to a 424B3 filed with the Securities and Exchange Commission on Tuesday.

Proceeds will be used for general corporate purposes.

PSE&G is a Newark, N.J.-based utility.

Great Plains Energy firms

Great Plains Energy’s 3.9% notes due April 1, 2027 firmed about 1 bp to 144 bps bid in the secondary market on Tuesday, a source said.

Great Plains sold $1.4 billion of the notes on March 6 at a spread of Treasuries plus 145 bps.

The company’s 4.85% bonds due April 1, 2047 tightened 5 bps to 175 bps bid.

The company sold $1 billion of the 30-year bonds in the March offering at a spread of Treasuries plus 175 bps.

The bonds carry mandatory and special calls of 101 if a merger with Topeka-based Westar Energy Inc. does not close or is delayed.

In April, Kansas regulators rejected the deal for a combined utility of Great Plains Energy and Westar Energy. The deal also requires approval from Missouri and federal regulators.

Kansas City, Mo.-based Great Plains is the holding company of Kansas City Power & Light Co. and KCP&L Greater Missouri Operations Co.

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