Heinz prices $10 billion megadeal for Kraft merger; Barclays tightens; Citi, Goldman stable

By Aleesia Forni and Cristal Cody

Virginia Beach, June 23 – H.J. Heinz Co. sold a $10 billion seven-part megadeal on Tuesday, highlighting another strong session for investment-grade bonds.

Heinz priced the deal to help fund the roughly $46 billion merger of the company with Kraft Foods Group Inc., which will be renamed Kraft Heinz Foods Co.

The behemoth offering was swamped with orders, reaching more than a $40 billion book shortly after midday, a market source said.

Tranches of the deal sold between 15 basis points to 25 bps tight of initial price thoughts.

The session also hosted a new deal from Pershing Square Holdings, Ltd. The company priced $1 billion of seven-year senior notes in line with talk.

Tuesday’s activity pushes the week’s total supply to roughly $12.76 billion, halfway towards what is expected to be around a $25 billion week.

Bank and financial paper traded unchanged to tighter over the day.

Barclays plc’s 2.875% notes due 2020 firmed 4 bps in secondary trading.

Citigroup Inc.’s 3.3% senior notes due 2025 were mostly unchanged.

Goldman Sachs Group Inc.’s 3.55% senior notes due 2025 headed out flat.

The Markit CDX North American Investment Grade series 23 index was unchanged at a spread of 65 bps.

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