Municipals close unchanged with weaker tone; San Francisco Airport prices $550 million bonds

By Sheri Kasprzak

New York, Nov. 5 - The municipals market once again closed mostly unchanged Thursday, but market insiders reported that some weakness crept into the yield curve, especially on the long end.

"It's looking maybe a little mixed," one trader said.

"Out on the long end, there's a sense of weakness, and on the short end, it's a little firmer. We're basically unchanged. Not a lot trading today."

Meanwhile, in the primary market, the San Francisco Airport Commission sold $550 million in series 2009E revenue bonds Thursday for the San Francisco Airport, said a pricing sheet.

The bonds (A1/A/A+) were sold through senior manager Citigroup Global Markets Inc.

The bonds are due 2020 to 2026 with term bonds due 2029, 2032 and 2039. The serials have coupons from 4.375% to 5.5%. The 2029 bonds have a 5% coupon, priced at 97.927, and the 2032 bonds have a 5.25% coupon, priced at 96.795. The 2039 bonds have a 6% coupon but were not reoffered.

Proceeds will be used to fund infrastructure improvements to the airport.

Columbus sells $251.88 million

Elsewhere in the primary market Thursday, the City of Columbus, Ohio, priced $251.88 million in series 2009 general obligation bonds, said a term sheet.

The sale included $32.63 million in series 2009A bonds, $11.22 million in series 2009B bonds, $180.305 million in series 2009C taxable bonds, $11.395 million in series 2009D taxable bonds and $16.33 million in series 2009E taxable bonds.

The 2009A bonds are due 2010 to 2025 with coupons from 2% to 5%, and the 2009B bonds are due 2010 to 2019 with coupons from 2.5% to 4%. The 2009C bonds are due 2013 to 2024 with a term bond due 2028. The coupons range from 2.26% to 5.29%, all priced at par, and the 2028 bonds have a 5.8% coupon, also priced at par. The 2009D bonds are due 2013 to 2017 and 2022 to 2025 with a term bond due 2030. The serials have coupons from 2.26% to 5.39%, all priced at par, and the 2030 bonds have a 5.92% coupon, priced at par. The 2009E bonds are due 2030 with a 5.92% coupon, priced at par.

The bonds (Aaa/AAA/) were sold through senior managers Stifel, Nicolaus & Co. Inc. and J.P. Morgan Securities Inc.

Proceeds will be used to fund capital projects from the Department of Health and Department of Public Safety, as well as parks and recreation, transportation, refuse collection, electricity and other projects.

Mississippi prices $62.127 million

Also on Thursday, the State of Mississippi priced $62.127 million in series 2009 G.O. notes, said a term sheet.

The notes were sold competitively with Morgan Stanley & Co. Inc. winning the bid.

The notes are due Nov. 17, 2010 and include $21.875 million in series 2009B taxable notes and $40.252 million in series 2009B tax-exempt notes.

The taxable notes have a 0.54% coupon, priced at par, and the tax-exempt notes have a 1.25% coupon to yield 0.35%.

Proceeds will be used to fund a variety of grants, including infrastructure, water, railroad, industry and technology grants.

California Statewide to price $1.5 billion

Looking to the week's upcoming bond sales, the California Statewide Development Authority is set to sell $1.5 billion in series 2009 State of California Proposition 1A receivables program revenue bonds on Tuesday, said a sales calendar. A retail order period will be conducted Friday and Monday.

The bonds (Baa1/A/BBB) will be sold through lead manager Goldman, Sachs & Co.

The bonds are due June 15, 2013.

Proceeds from the deal will be used to repay borrowings from local property taxes.

Also coming up Tuesday, the Dormitory Authority of the State of New York is expected to sell $100 million in series 2009A state university dormitory facilities lease revenue bonds on Tuesday, said a preliminary official statement and a sales calendar.

The bonds (Aa3/AA-/) will be sold on a negotiated basis with Siebert Brandford Shank & Co. LLC as the lead manager.

Proceeds will be used to renovate and construct dormitory buildings at the state's universities and colleges.

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