Bard, Tyco, Agrium tap market; banks sell debt to repay TARP; industrials firm; banks weaken

By Andrea Heisinger and Cristal Cody

New York, Dec. 15 - C.R. Bard, Inc., Tyco Electronics Group SA, Huntington Bancshares Inc., First Horizon National Corp. and Agrium Inc. all did trades in the high-grade market on Wednesday.

There was also an issue of split-rated passthrough certificates from US Airways, Inc.

Bard sold its $750 million of notes in two parts fairly early in the afternoon. The deal has maturities of five years and 10 years.

Luxembourg-based Tyco Electronics priced $250 million of 10-year notes, in part to repay debt.

Ohio-based Huntington Bancshares sold $300 million of 10-year subordinated notes - along with common stock - in order to repurchase preferred stock from the Department of the Treasury.

Another bank in the market was First Horizon National. The financial holding company sold an upsized $500 million of five-year notes.

Canada's Agrium sold $500 million of 30-year debentures.

There was a small $65 million sale in the preferred stock market from Cogdell Spencer Inc. It had gone overnight from Tuesday.

The primary market saw renewed confidence from the previous day when issuers had opted to sit on the sidelines.

"It was just too risky, I think, and there was no reason not to wait [until Wednesday]," a source said. Issuers chose not to issue on Tuesday as the Federal Reserve Federal Open Market Committee met.

"Today the tone was a little better," the source said. "There wasn't anything keeping them out."

Thursday could be slower, although there could be deals trying to get done prior to the coming week that is expected to have minimal volume.

"It's looking like it's going to be dead after this week," a second source said.

Overall investment-grade Trace volume fell 6% to just over $12 billion, according to a market source.

In secondary trading, the new debt from Agrium and C.R. Bard firmed, while Tyco's notes were flat, sources said.

Bank and financial bonds were unchanged "to a tad wider," a trader said.

"Spreads on industrials a couple tighter," the trader said.

The Markit CDX Series 14 North American investment-grade index eased 1 basis point on Wednesday to a spread of 87 bps, according to Markit Group Ltd.

Treasuries continued losses on Wednesday, sending the 10-year benchmark note yield up 6 bps to 3.52% as the Senate passed the $858 billion tax-cut plan that extends Bush-era reductions for all income levels and is expected to boost economic growth. The 30-year bond yield rose 8 bps to 4.6%.

Bard's two tranches

C.R. Bard tapped the market for $750 million of senior notes (A3/A) in two parts, an informed source said.

The $250 million of 2.875% five-year notes priced at a spread of Treasuries plus 83 bps.

A $500 million tranche of 4.4% 10-year notes sold at a spread of 100 bps over Treasuries.

The bookrunners were Bank of America Merrill Lynch, Goldman Sachs & Co. and Wells Fargo Securities LLC.

Proceeds will be used to repurchase common stock and for general corporate purposes.

In secondary trading, the notes due 2016 were quoted at 82 bps bid, 79 bps offered, traders said.

The tranche of notes due 2021 was seen at 98 bps bid, 96 bps offered and later at 97 bps bid, 95 bps offered.

The Murray Hill, N.J.-based company designs and manufactures patient care devices.

Tyco sells 10-year notes

Tyco Electronics Group sold $250 million of 4.875% 10-year notes (Baa2/BBB/BBB) at a spread of Treasuries plus 145 bps, said a source who worked on the trade.

Bank of America Merrill Lynch and Goldman Sachs were active bookrunners.

Proceeds are going toward general corporate purposes including the repayment of debt.

The deal is guaranteed by Tyco Electronics Ltd.

In the secondary market, the notes were trading flat, a trader said.

The holding company for Tyco is based in Luxembourg.

Agrium prices $500 million

Agrium priced $500 million of 6.125% 30-year senior debentures (Baa2/BBB) to yield Treasuries plus 160 bps, a source away from the trade said.

BNP Paribas Securities Corp., RBC Capital Markets Corp. and Scotia Capital USA Inc. were the bookrunners.

Proceeds are going to repay $125 million of 8.25% debentures due Feb. 15, 2011 and a portion of borrowings under a revolving credit facility incurred in connection with the AWB Ltd. acquisition.

Agrium's 30-year debentures were seen trading tighter at 155 bps bid, 150 bps offered and later were quoted at 153 bps bid, 151 bps offered, sources said.

The agriculture products and service retailer is based in Calgary, Alta.

Deals to repay TARP

There were two sales in the market for the day from regional banks wanting to repay TARP funds to the Treasury.

Huntington Bancshares priced $300 million of 7% 10-year subordinated notes at par to yield 7%, a market source away from the sale said.

The yield was talked in the 7.125% area and priced at the tight end of that.

The notes (Baa3/BBB-/BBB+) have a spread of 344.9 bps.

Goldman Sachs was the bookrunner.

The proceeds are being used to repurchase $1.4 billion of series B fixed-rate cumulative perpetual preferred stock issued to the Treasury under the Troubled Asset Relief Capital Purchase Program. Huntington has also sold $920 million of common stock.

The bank holding company is based in Columbus, Ohio.

The other sale in the market came from First Horizon National. The Memphis-based financial holding company priced an upsized $500 million of 5.375% five-year senior notes (Baa1/BBB-) at a spread of 337.5 bps over Treasuries, a source close to the trade said.

The deal size was increased from $400 million.

The notes were sold at the tight end of talk in the 350 bps area, a source said. There was a margin of 12.5 bps on either side of the talk.

Goldman Sachs, J.P. Morgan Securities Inc. and Morgan Stanley & Co., Inc. were active bookrunners.

Proceeds will be used to repurchase outstanding cumulative preferred stock, series CPP, and to redeem $103 million principal amount of 8.07% junior subordinated deferrable interest debentures.

In the secondary market, Huntington Bancshares' new notes were quoted by one trader at 100.5 bid, 101.5 offered on Wednesday.

Later, the notes traded at 101.125 bid, 101.00 offered, another source said.

First Horizon's notes traded in the afternoon at 335 bps bid, 327 bps offered, a trader said.

A trader on another desk saw the notes tighter on the offer side at 325 bps.

US Airways sells passthroughs

US Airways sold about $340.26 million of class A and B passthrough certificates, series 2010-1, a source close to the sale said late on Wednesday.

The $262.86 million of 6.25% class A certificates due 2023 (Baa2/BBB) priced at par to yield 6.25% with a spread of 310 bps over Treasuries.

A second part was $77.40 million of 8.5% class B certificates due 2017 (B2/B+) that priced at par to yield 8.5% with a spread of Treasuries plus 685 bps.

Morgan Stanley, Citigroup and Credit Suisse Securities were the bookrunners. Bank of America Merrill Lynch was co-manager.

Proceeds will be placed in escrow and used to acquire equipment notes. These notes will be issued to refinance eight Airbus aircraft owned by US Airways.

The commercial airline is based in Tempe, Ariz.

Cogdell's preferreds

Real estate investment trust Cogdell Spencer sold $65 million, or 2.6 million shares, of 8.5% series A cumulative redeemable perpetual preferred stock at par of $25, according to an FWP filing with the Securities and Exchange Commission.

There is an over-allotment option of $9.75 million, or 390,000 shares.

Citigroup, Jefferies and KeyBanc Capital Markets were the bookrunners.

Proceeds will be contributed to the company's operating partnership, Cogdell Spencer LP, in exchange for operating partnership units. The proceeds will then be contributed to Erdman Co. to repay a senior secured term loan and to be used for working capital.

The real estate investment trust for medical office properties is based in Charlotte, N.C.

Nuveen funds sell $469 million

Four Nuveen Investments, LLC funds announced on Wednesday sales of $469.2 million of weekly variable-rate demand preferred shares.

The Nuveen New York Quality Income Municipal Fund, Inc. sold $161.7 million, the Nuveen Premier Insured Municipal Income Fund, Inc. sold $130.9 million, the Nuveen California Investment Quality Municipal Fund, Inc. sold $95.6 million, and the Nuveen California Performance Plus Municipal Fund, Inc. sold $81 million.

The preferreds were sold under Rule 144A.

The proceeds will be used to redeem at par all of the funds' outstanding auction-rate preferreds.

The remarketing agent is Citigroup.

The funds are diversified, closed-end management investment companies.

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