Cargill, Campbell, Kansas City Southern, Sonoco price; Nationwide on backburner; spreads ease

By Cristal Cody

Tupelo, Miss., April 20 – A handful of high-grade issuers kicked the week off with new bonds priced on Monday.

Cargill Inc. came by with $1.5 billion of senior notes in two tranches.

Campbell Soup Co. sold $1 billion of notes in two tranches in its first high-grade offering since 2018.

Kansas City Southern priced $550 million of 30-year guaranteed senior notes.

Sonoco Products Co., which was last reported in the primary market in 2011, priced an upsized $600 million of 10-year notes during the session.

Meanwhile, Nationwide Mutual Insurance Co. postponed a Rule 144A and Regulation S offering of dollar-denominated 40-year fixed-to-floating-rate notes due to market conditions on Monday.

Market tone was weaker as oil prices sank and equities declined.

The Markit CDX North American Investment Grade 33 index softened about 6 basis points from Friday to a spread of 93.07 bps on Monday.

The iShares iBoxx Investment Grade Corporate Bond ETF declined 0.57% to 129.82.

The PIMCO Investment Grade Corporate Bond Index ETF closed down 0.67% at 110.10.

As much as $60 billion of high-grade bond volume is expected this week with some market sources forecasting about $40 billion to $50 billion of supply.

Last week, high-grade issuers sold more than $60 billion of bonds including additional supply on Friday.

Cargill prices $1.5 billion

Cargill priced $1.5 billion of senior notes (A2/A/A) in two tranches in the new deal, according to a market source.

A $750 million offering of 1.375% notes due July 23, 2023 priced at a Treasuries plus 115 bps spread.

Initial price talk was in the Treasuries plus 160 bps area.

Cargill sold $750 million of 2.125% 10-year notes at a spread of 150 bps over Treasuries.

The notes were talked to price in the Treasuries plus 195 bps area.

BofA Securities Inc., BNP Paribas Securities Corp., Citigroup Global Markets Inc., Deutsche Bank Securities Inc. and J.P. Morgan Securities LLC were the bookrunners.

Cargill is a Minneapolis, Minn.-based food and agriculture company.

Campbell Soup raises $1 billion

Campbell Soup sold $1 billion of notes (Baa2/BBB/) in two tranches, according to a market source.

The company sold $500 million of 2.375% 10-year notes at a spread of Treasuries plus 175 bps.

Initial talk was in the Treasuries plus 210 bps area with guidance tightened to the 180 bps spread area, plus or minus 5 bps.

A $500 million tranche of 3.125% 30-year notes were sold at a spread of 190 bps over Treasuries.

The 30-year notes were talked at the 215 bps spread area and guided to print at the Treasuries plus 195 bps area, plus or minus 5 bps.

Barclays, BofA Securities, Citigroup, J.P. Morgan, BNP Paribas Securities Corp. and Credit Suisse Securities (USA) LLC were the bookrunners.

Campbell Soup is a convenience foods company based in Camden, N.J.

Sonoco upsizes deal

Sonoco Products priced an upsized $600 million of 3.125% 10-year notes (Baa2/BBB/) at 99.888 to yield 3.138% and a spread of Treasuries plus 250 bps, according to a market source and an FWP filing with the Securities and Exchange Commission.

Initial price talk was in the Treasuries plus 280 bps spread area.

The deal was upsized from $500 million.

BofA Securities, J.P. Morgan, U.S. Bancorp Investments Inc. and Wells Fargo Securities LLC were the bookrunners.

Sonoco Products is a Hartsville, S.C., maker of paperboard-based and other packaging products.

Kansas City Southern prints

Kansas City Southern was in the primary market with $550 million of 3.5% 30-year guaranteed senior notes (Baa2/BBB/BBB) priced on Monday at 99.208 to yield 3.543%, or a spread of Treasuries plus 230 bps, according to a market source and an FWP filing.

Initial price talk was in the Treasuries plus 255 bps area.

BofA Securities, J.P. Morgan and Morgan Stanley & Co. LLC were the bookrunners.

The notes are guaranteed by certain of Kansas City Southern’s domestic subsidiaries.

The rail transportation holding company for Kansas City Southern Railway Co. is based in Kansas City, Mo.

Nationwide in pipeline

Nationwide Mutual Insurance’s fixed-to-floating-rate notes due April 30, 2060 (A3/A-/) remain in the deal pipeline after the offering was postponed on Monday due to market conditions, according to an informed source.

Initial price talk on the issue is in the Treasuries plus 285 bps area.

Book orders were said to be at $750 million before the deal was postponed.

BofA Securities, J.P. Morgan and Wells Fargo are the lead managers.

The insurance provider is based in Columbus, Ohio.

© 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.