Yara brings $1 billion; Tokyo Metropolitan sells notes; Vodafone tightens; Barclays firms

By Cristal Cody

Tupelo, Miss., May 24 – High-grade supply priced on Thursday include a $1 billion offering of 10-year notes from Yara International ASA.

Also, the Tokyo Metropolitan Government sold $500 million of five-year senior notes tighter than talk.

Deal volume has been mixed over the week.

Supply came to less than $3 billion total for Monday and Tuesday, while Wednesday’s session saw more than $17 billion of bonds price. Issuance in the previous session was led by Vodafone Group plc’s $11.5 billion six-tranche offering of senior notes.

Week to date, more than $21 billion of investment-grade bonds have priced.

About $25 billion of issuance was forecast for the holiday-shortened week. The bond markets will close early Friday and remain closed on Monday for the Memorial Day holiday.

The Markit CDX North American Investment Grade 30 index closed modestly softer at a spread of 62.2 basis points.

In the secondary market, Vodafone’s six tranches of bonds traded about 6 bps to 10 bps tighter than issuance, a source said.

The company’s $3 billion of 4.375% notes due May 30, 2028 firmed to the 147 bps area.

Vodafone’s $3 billion tranche of 5.25% notes due May 30, 2048 tightened to the 208 bps area in secondary trading.

In other trading, bank and financial paper was mostly flat to better, a source said.

Barclays plc’s notes traded about 1 bp to 6 bps tighter over the day with the company’s 4.972% fixed-to-floating-rate notes due May 16, 2029 improved 1 bp to 201 bps bid.

Barclays (A2/A/A) sold $1.75 billion of the 11-year notes on May 9 at par to yield a Treasuries plus 197 bps spread.

The company is reportedly considering a potential merger with Standard Chartered plc.

Dollar Tree Inc.’s senior notes (Baa3/BBB-/) also tightened about 1 bp to 2 bps during the session, according to a market source. The company’s 4% notes due May 15, 2025 improved 1 bp to 121 bps bid, while the 4.2% notes due May 15, 2028 tightened 2 bps to 149 bps bid.

Dollar Tree sold $1 billion of the seven-year notes on April 5 at a Treasuries plus 125 bps spread.

The company priced $1.25 billion of the 10-year notes last month at a spread of 140 bps over Treasuries.

Dollar Tree will release its first quarter earnings results on May 31.

Yara prices $1 billion

Yara International (Baa2/BBB/) priced $1 billion of 4.75% 10-year senior notes on Thursday at a spread of 180 bps over Treasuries, according to a market source and a news release.

The notes priced tighter than initial talk in the Treasuries plus 195 bps area and on the tight side of later guidance in the Treasuries plus 185 bps area, plus or minus 5 bps.

Citigroup Global Markets Inc., Deutsche Bank Securities Inc., J.P. Morgan Securities LLC and Societe Generale were the lead managers for the Rule 144A and Regulation S deal.

The company held fixed-income investor calls on Monday and Tuesday.

The Norwegian chemical company is based in Oslo.

Tokyo prices $500 million

The Tokyo Metropolitan Government (/A+/) priced $500 million of 3.25% five-year senior notes on Thursday at mid-swaps plus 42 bps, or a spread of Treasuries plus 52.25 bps, according to a market source.

The notes were initially talked to price in the mid-swaps plus 45 bps area with guidance later tightened to the mid-swaps plus 44 bps area.

Barclays, Citigroup Global Markets, J.P. Morgan Securities and Nomura Securities International, Inc. were the bookrunners.

Tokyo Metropolitan Government is the government of the Tokyo metropolis in Japan with headquarters based in Shinjuku-ku, Tokyo.

Funds add more cash

Investment-grade corporate funds once more benefited from an inflow, gaining $2.529 billion in the week to May 23, according to fund-flow statistics generated by AMG Data Services Inc.

That followed inflows of $3.069 billion, $0.804 billion and $0.997 billion in the preceding weeks, as reported by the Arcata, Calif.-based unit of Thomson Reuters Corp’s Lipper analytics division.

The IG funds continue to have seen 10 straight inflows.

Apart from the Feb. 14 and Feb. 21 weeks, every week so far this year has seen positive flows and in fact before those two weeks in February investment-grade corporates saw a 21-week run of inflows dating back to mid-September, according to a Prospect News analysis of the data.

The latest addition of cash raises the year-to-date inflow for the IG corporates to $45.43 billion from $42.90 billion the week prior, another new peak for the year so far.

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