NBC sells in connection with equity sale; Stryker, ANZ tap market; NBC notes firm; banks widen

By Aleesia Forni and Andrea Heisinger

New York, March 20 - New bonds continued to flow into the high-grade bond market during Wednesday's session, including a $4 billion sale from NBCUniversal Enterprise Inc.

The sale was done as part of General Electric Co.'s sale of its equity stake in the company to Comcast Corp.

There was about $11.8 billion of investor demand for the bonds, a source close to the trade said.

Also in the primary, medical technology company Stryker Corp. sold $1 billion of notes due 2018 and 2043.

ANZ New Zealand (International) Ltd. priced $750 million of three-year bonds privately.

There was also a $300 million reopening of notes due March 2016 by British American Tobacco International Finance plc.

A $175 million sale of $25-par notes was done by Hanover Insurance Group, Inc. The size was increased from a minimum of $100 million.

The market was called "solid" by a source who worked on the NBC sale.

"I don't know if it was better or worse than yesterday, but it was fine," the source added.

More supply is on tap for Thursday including a benchmark-sized trade from a financial name, a source said.

In the secondary market, the new notes from NBCUniversal were trading tighter, according to one market source.

The source saw the six-year notes trading 8 basis points better in the secondary, and the five-year fixed-rate notes were quoted 4 bps tighter. The three-year floaters were trading 4 bps better.

Citigroup Inc.'s new 5.8% series C noncumulative perpetual preferreds - a $500 million issue that priced Tuesday - freed up early in the day on Wednesday. That issue was quoted at $24.90 bid, $24.95 offered.

In other trading, bank paper from JPMorgan Chase & Co. and Merrill Lynch weakened during the session, according to a market source.

NBC resells bonds

NBCUniversal Enterprise tapped the market for $4 billion of notes (A3/A-/BBB+) in four tranches on Wednesday, an informed source said.

The coupons on the bonds were set on Tuesday, the source said, as part of General Electric's sale of its equity stake in the company to Comcast, which was completed that day.

There was $700 million of three-year floating-rate notes sold at 100.113 with a coupon of Libor plus 53.7 bps to yield Libor plus 50 bps. Guidance was in the Libor plus 50 bps to 55 bps range.

A $700 million tranche of five-year floaters priced at 100.075 with a coupon of Libor plus 68.5 bps to yield Libor plus 67 bps. There was talk in the Libor plus low 70 bps area.

The third part was $1.1 billion of 1.662% five-year notes priced at a spread of Treasuries plus 85 bps. Talk was in the Treasuries plus 90 bps area.

Finally, there was $1.5 billion of 1.974% six-year notes sold at a spread of 120 bps over Treasuries. Guidance was in the 130 bps area over Treasuries.

The secondary market saw the six-year notes trade at 112 bps bid near the end of the session.

The five-year fixed-rate notes were quoted at 81 bps bid by a trader, and the three-year floaters traded 4 bps tighter at 46 bps bid.

The sale was done under Rule 144A.

Investor demand was strong across the board, including $2.2 billion on the three-year floaters, $1.5 billion for the five-year floaters, $2.6 billion for the five-year notes and $5.5 billion for the six-year tranche, the source said.

The bookrunners were Barclays, Citigroup Global Markets Inc., J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC.

The bonds are guaranteed by Comcast. General Electric on Tuesday closed its transaction with Comcast for the remaining 94% equity stake in NBCUniversal.

NBC was last in the U.S. bond market with a $2 billion trade in tranches due 2023 and 2043 on Sept. 28.

The media and entertainment company is based in New York.

Stryker's two tranches

Stryker was in the day's session with a $1 billion sale of notes (A3/A+/) in two parts, a market source said.

A $600 million tranche of 1.3% five-year notes sold at a spread of Treasuries plus 60 bps.

The second part was $400 million of 4.1% 30-year bonds priced at 100 bps over Treasuries.

Barclays, BofA Merrill Lynch and Goldman Sachs & Co. were the bookrunners.

Proceeds are being used for working capital and other general corporate purposes.

Stryker, a medical technology company based in Kalamazoo, Mich., was last in the market with a $750 million sale of 2% five-year notes priced at 115 bps over Treasuries on Sept. 13, 2011.

ANZ offers $750 million

ANZ New Zealand priced $750 million of 1.125% three-year notes (Aa3/AA-/AA-) at Treasuries plus 77 bps, an informed source said.

Guidance was in the 80 bps area.

The sale was done via Rule 144A and Regulation S.

The bookrunners were Citigroup, JPMorgan and ANZ.

The financial services company is based in Melbourne.

BAT's reopening

British American Tobacco International Finance reopened its issue of 1.125% notes due March 2016 (A3/A-/A-) to add $300 million, a market source said.

Pricing was at mid-swaps plus 70 bps.

The bookrunners were Barclays, Deutsche Bank Securities Inc. and HSBC Securities (USA) Inc.

The sale is guaranteed by British American Tobacco plc and British American Tobacco Holdings (the Netherlands) BV.

BAT International was last in the U.S. bond market with a $2 billion sale of notes in three tranches on May 31, 2012.

The financing subsidiary of multinational tobacco company British American Tobacco plc is based in London.

BofA gives terms

Bank of America Corp. gave the terms of its $4 billion sale of senior notes (Baa2/A-/A) priced in four parts Tuesday in FWP filings with the Securities and Exchange Commission.

The sale included $750 million of three-year floating-rate notes sold at par to yield Libor plus 82 bps.

A $1 billion tranche of five-year floaters sold at par to yield Libor plus 107 bps.

There was also a reopening of 2% notes due 2018 to add $1 billion. The reopened notes priced at a spread of Treasuries plus 122 bps. Total issuance is $3 billion including $2 billion priced on Jan. 8 at 125 bps over Treasuries.

The final part was a reopening of 3.3% notes due 2023 to add $1.25 billion. The notes sold at 147 bps over Treasuries. Total issuance is $4.25 billion including $3 billion sold Jan. 8 at 150 bps over Treasuries.

BofA Merrill Lynch was the bookrunner.

The financial services company is based in Charlotte, N.C.

Hanover's $25-par notes

Hanover Insurance Group sold $175 million of 6.35% $25-par subordinated debentures due March 30, 2053.

Price talk was 6.375% to 6.5%, according to a trader at midday.

"It seems to be doing pretty well," the trader said, seeing paper trade around $24.90 in the midday gray market.

Morgan Stanley, BofA Merrill Lynch and Wells Fargo Securities LLC were the joint bookrunners.

The Worcester, Mass.-based property and casualty insurance company intends to list the new issue on the New York Stock Exchange.

Proceeds will be used for general corporate purposes and working capital, which may include stock repurchases.

JPMorgan weaker

The secondary market saw the $3 billion of 6.3% notes due 2019 from JPMorgan weaken 3 bps to 155 bps bid on Wednesday.

JPMorgan priced the 10-year bonds on April 16, 2009 at 305 bps over Treasuries.

Merrill Lynch widens

In other trading, Merrill Lynch's 6.875% notes due 2018 widened 10 bps to 163 bps bid near the end of New York's session.

On April 22, 2008, the bank priced $5.5 billion of the 10-year notes at 320 bps over Treasuries.

Stephanie N. Rotondo contributed to this review

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