Primary action thins; Citi subordinated notes mixed; Teva stronger; credit spreads firm

By Cristal Cody

Eureka Springs, Ark., July 20 – Investment-grade primary action stayed fairly quiet over Wednesday’s session.

About $23 billion of bonds have priced so far in the week. The bulk of issuance, including Teva Pharmaceutical Finance Netherlands III BV’s $15 billion six-part notes offering, have come on Monday.

Teva Pharmaceutical Finance’s notes, which are guaranteed by Teva Pharmaceutical Industries Ltd. and were brought to market to help finance its acquisition of the generics business of Allergan plc, were stronger across the two- to 30-year maturities in secondary trading earlier on Wednesday, a market source said.

Teva’s 1.4% notes due 2018 were quoted at 61 bps offered. The company sold $1.5 billion of the notes on Monday at Treasuries plus 75 bps.

Teva’s 4.1% notes due 2046 were 12 bps tighter in the secondary market at 173 bps offered. The company priced $2 billion of the long bonds in Monday’s offering at 185 bps plus Treasuries.

Citigroup Inc.’s subordinated notes (Baa3/BBB/A-) traded flat to wider over the day.

The company’s 4.6% subordinated notes due 2026 headed out at 231 bps bid on Wednesday, about 6 bps softer since Monday, according to a market source.

The company’s new 4.125% subordinated notes due 2028 were flat at 255 bps offered in secondary trading earlier in the day.

The Markit CDX North American Investment Grade index closed on Wednesday 2 bps tighter at a spread of 70 bps.

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