Nationwide, Aviation Capital price; AT&T upsizes; Burlington prices better than talk

By Cristal Cody

Tupelo, Miss., July 25 – Several issuers priced notes on the tight side of guidance on Wednesday, while high-grade credit spreads continued to tighten.

Nationwide Building Society sold $1 billion of six-year fixed-to-floating-rate notes on the tight side of guidance.

Aviation Capital Group LLC’s $800 million of fixed- and floating-rate notes also priced on the tight side of guidance.

In other issuance, AT&T Inc. upsized its offering of $25-par global notes due Aug. 1, 2067 to $750 million from $250 million, a source said. The notes priced on the tight side of talk.

Burlington Northern Santa Fe, LLC’s $750 million of long 30-year senior debentures priced better than talk.

More than $13 billion of high-grade bonds have priced week to date. Market sources forecast about $20 billion to $25 billion of weekly supply.

Fifth Third Bank leads corporate issuance week to date in deal size with a $1.55 billion three-part offering of senior notes that priced on Monday.

The largest bond issue priced in the first three sessions was in SSA volume from International Finance Corp., which sold $2 billion of five-year notes tighter than talk on Tuesday.

The Markit CDX North American Investment Grade 30 index closed more than 1 basis point better at a spread of 60 bps. Credit spreads ended more than 1 bp tighter on Tuesday after closing Monday mostly flat.

Nationwide Building sells $1 billion

Nationwide Building Society priced $1 billion of 4.363% fixed-to-floating-rate notes due Aug. 1, 2024 (Baa1/BBB+/A) on Wednesday at a spread of 155 bps over Treasuries, according to a market source.

The rate will reset to a floating rate of Libor plus 139.2 bps after the initial fixed-rate period.

The notes were initially talked to price with a spread in the Treasuries plus 170 bps area with guidance later tightened to the Treasuries plus 160 bps area, plus or minus 5 bps. They came at the tight side of that final guidance.

BofA Merrill Lynch, Barclays, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC were the bookrunners.

The mutual financial company and building society is based in Swindon, England.

Aviation Capital prints

Aviation Capital Group sold $800 million of senior notes (/A-/BBB+) in two tranches on Wednesday, according to a market source.

The company priced $300 million of three-year floating-rate notes at Libor plus 67 bps.

The floaters were talked to price in the Libor plus 70 bps area, plus or minus 3 bps, tighter than initial price talk in the Libor plus 95 bps to Libor plus 100 bps area. They priced at the tight end of that guidance.

Aviation Capital sold $500 million of 4.125% seven-year fixed-rate notes at a Treasuries plus 145 bps spread, on the tight side of guidance in the Treasuries plus 150 bps area, plus or minus 5 bps, and better than initial price talk in the Treasuries plus 170 bps area.

Barclays, BNP Paribas Securities Corp., Goldman Sachs & Co. LLC, J.P. Morgan Securities and Mizuho Securities USA Inc. were the bookrunners.

Aviation Capital Group, a privately held subsidiary of Pacific Life Insurance Co., is a global aircraft leasing company based in Newport Beach, Calif.

AT&T prices $25-par notes

AT&T priced $750 million of 5.625% $25-par global notes due Aug. 1, 2067 (Baa2/BBB/A-) on Wednesday, according to a market source and an FWP filing with the Securities and Exchange Commission.

The notes were initially talked to price in the 5.625% to 5.75% area.

The deal includes an over-allotment option of up to $112.5 million.

BofA Merrill Lynch, Morgan Stanley & Co. LLC, Wells Fargo Securities, LLC, J.P. Morgan Securities, RBC Capital Markets, LLC and UBS Securities LLC were the bookrunners.

AT&T is a Dallas-based telecommunications company.

Burlington Northern sells bonds

Burlington Northern Santa Fe sold $750 million of 4.15% long 30-year senior debentures (A3/A+/) on Wednesday at 99.252 to yield 4.194%, or a spread of 112.5 bps over Treasuries, according to a market source and an FWP filing with the SEC.

The notes were talked to price in the Treasuries plus 120 bps area, plus or minus 5 bps, with initial price talk in the Treasuries plus 135 bps area.

J.P. Morgan Securities, Morgan Stanley, Wells Fargo Securities, Citigroup Global Markets, Goldman Sachs and BofA Merrill Lynch were the bookrunners.

The holding company for railroad transportation subsidiaries is based in Fort Worth, Texas.

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