Pricing action slows; Ford Motor Credit, UDR, KfW tap primary market; credit spreads stable

By Cristal Cody

Tupelo, Miss., June 7 – Investment-grade deal action slowed on Wednesday following heavy issuance in the first two sessions of the week.

In corporate supply, Ford Motor Credit Co. LLC priced a $1 billion two-tranche offering of notes.

UDR, Inc. came with $300 million of 10-year medium-term notes.

Also on Wednesday, Toll Brothers Finance Corp. priced a $150 million add-on to its split-rated 4 7/8% senior notes due March 15, 2027 (Ba1/BB+/BBB-) at 103.655 to yield 4.4%, according to market sources.

The yield printed at the tight end of the 4.4% to 4.45% yield talk.

The add-on came in a high-grade execution that was priced in the investment-grade syndicate desk, sources said.

SunTrust Robinson Humphrey Inc. was the lead. Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Mizuho Securities USA LLC, SunTrust and Wells Fargo Securities LLC were the joint bookrunners.

The Horsham, Pa.-based real estate company plans to use the proceeds for general corporate purposes.

In other issuance on Wednesday, KfW brought $1 billion of 18-month senior global notes to the primary market.

In the secondary market, Ford Motor Credit’s existing bonds traded about 1 basis point to 3 bps softer on Wednesday, a source said.

The Markit CDX North American Investment Grade index closed mostly unchanged at a spread of 61 bps.

Ford sells $1 billion

Ford Motor Credit priced $1 billion of notes in a two-part offering on Wednesday, according to an FWP filing with the Securities and Exchange Commission.

The $650 million tranche of 2.425% three-year fixed-rate notes priced at par to yield a spread of Treasuries plus 98 bps.

The company sold $350 million of three-year floating-rate notes at par to yield Libor plus 79 bps.

Banco Bradesco BBI SA, Citigroup Global Markets, Commerz Markets LLC, Deutsche Bank Securities, BofA Merrill Lynch and Morgan Stanley & Co. LLC were the bookrunners.

Proceeds will be added to the company’s general funds and will be available to purchase receivables, for loans and for debt retirement.

Ford Motor Credit is the financing arm of Dearborn, Mich.-based automaker Ford Motor Co.

UDR prices notes

UDR priced $300 million of 3.5% 10-year medium-term notes on Wednesday at a spread of Treasuries plus 135 bps, according to an FWP filing with the Securities and Exchange Commission.

The notes (Baa1/BBB+/) priced at 99.764 to yield 3.528%.

Citigroup Global Markets, J.P. Morgan Securities LLC and Wells Fargo Securities were the bookrunners.

The notes are fully and unconditionally guaranteed by United Dominion Realty, LP.

Proceeds will be used for general corporate purposes, including to repay outstanding debt.

UDR is a real estate investment trust that owns and operates apartment communities.

KfW raises $1 billion

KfW (Aaa/AAA/) priced $1 billion of 1.375% senior global notes due Dec. 14, 2018 on Wednesday at 99.984, according to an FWP filing with the SEC.

BofA Merrill Lynch, BMO Capital Markets Corp. and Commerz Markets were the lead managers.

The notes are guaranteed by the Federal Republic of Germany.

KfW is a government-backed bank based in Frankfurt.

Paul A. Harris contributed to this review

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.