Weatherford sells two tranches; coming week's issuance top heavy; Barrick firms; banks better

By Andrea Heisinger and Cristal Cody

New York, March 30 - There was a deal from Switzerland's Weatherford International (Bermuda) Ltd. on Friday to end a week in the high-grade bond market stocked with issuers based overseas.

The unit of the oilfield services company sold $1.3 billion of notes in tranches due 2022 and 2042.

The deal capped a week where more than $23 billion of bonds priced, according to data compiled by Prospect News.

There has been $15 billion to $20 billion predicted for each of the past two weeks, and that's the same range of issuance expected for the coming one.

"I think it will be closer to $15 [billion]," a syndicate source said late in the day. "There should be a couple of big trades. We're hearing about three to four bigger trades. It's going to be front loaded Monday and Tuesday."

It's a short week with Good Friday at the end, which is why most deals will be getting done before desks clear out.

"Nobody's going to sell anything after Wednesday," a market source said. "Everyone will be out of here by Thursday."

In the secondary market, Barrick Gold Corp.'s $2 billion of notes (Baa1/A-/) priced in two tranches on Thursday traded better in Friday's session.

Massachusetts Mutual Life Insurance Co.'s notes firmed 3 bps, while Flowers Foods, Inc.'s first bond deal traded unchanged.

The Markit CDX Series 18 North American Investment Grade index ended the day 2 basis points tighter at a spread of 91 bps.

Cable and telecom bonds firmed 2 bps to 5 bps on the day, a trader said.

Bank and financial paper traded mostly better.

Bank of America Corp.'s notes firmed 4 bps, while Morgan Stanley's notes have eased 2 bps since Thursday's trading.

Treasuries closed lower as buyers disappeared in the afternoon. The benchmark 10-year Treasury note yield rose to 2.21% from 2.16%. The 30-year bond yield climbed to 3.34% from 3.27%.

Weatherford's $1.3 billion

Weatherford International (Bermuda) sold $1.3 billion of senior notes (Baa2/BBB/) in two parts, an informed source said.

The $750 million of 4.5% 10-year notes sold at a spread of Treasuries plus 230 bps.

There was also a $550 million tranche of 5.5% 30-year bonds sold at Treasuries plus 265 bps.

J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC were the active bookrunners.

Proceeds will be used to repay existing short-term debt under a commercial paper program and for general corporate purposes.

The deal is guaranteed by Weatherford International Ltd. and Weatherford International Inc.

Weatherford was last in the market with a $1.4 billion issue of 10- and 30-year notes on Sept. 16, 2010. The 5.125% 10-year notes from that deal sold at 237.5 bps over Treasuries, and a 6.75% 30-year bond sold at 285 bps over Treasuries.

The oilfield services company is based in Geneva.

Barrick Gold tightens

Barrick Gold's $1.25 billion of 3.85% notes due 2022, which sold at a spread of Treasuries plus 170 bps on Thursday, traded tighter at 161 bps bid, 157 bps offered late Friday, a trader said.

The tranche of 5.25% bonds due 2042 was seen closing at 193 bps bid, 188 bps offered.

Barrick Gold sold $750 million of the 30-year bonds at 200 bps over Treasuries.

The gold mining company is based in Toronto.

MassMutual firms

Massachusetts Mutual Life Insurance's 2% notes due 2017 firmed in trading to 107 bps bid, 102 bps offered early on Friday, a trader said.

The company sold $500 million of the five-year notes (Aa2/AA/AA) at Treasuries plus 110 bps on Thursday.

The Springfield, Mass.-based insurance company last priced bonds in a $750 million deal of 30-year paper on May 27, 2009.

Flowers Foods flat

Flowers Foods' 4.375% senior notes due 2022 were seen unchanged at 225 bps bid, 221 bps offered early Friday with no other activity through the afternoon, a trader said.

The company sold $400 million of the 10-year senior notes (Baa2/BBB-/) at a spread of Treasuries plus 225 bps on Thursday.

Flowers Foods provides direct store and warehouse delivery of food and baked goods and is based in Thomasville, Ga.

Morgan Stanley eases

Morgan Stanley's 5.5% notes due 2021 traded at 365 bps bid, 355 bps offered on Friday, a trader said.

The notes were quoted on Thursday at 363 bps bid.

The New York-based investment bank sold $1 billion of the notes (A2/A/A) on Oct. 27 at a spread of 335 bps over Treasuries.

Bank of America firms

Bank of America's 5.7% senior notes due 2022 traded better at 270 bps bid, 265 bps offered, a trader said on Friday.

The notes traded on Thursday at 274 bps bid.

The Charlotte, N.C.-based financial services company reopened the issue (Baa1/A-/A) on Feb. 2 in a $750 million offering at a spread of 325 bps over Treasuries.

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