Munis close mixed as last of large offerings price; Arizona State brings $362.26 million bonds

By Sheri Kasprzak

New York, March 5 – Municipals were mixed to end the session Thursday as the last remaining offerings of the week priced, market sources said.

Long bonds saw some significant improvement, but shorter bonds struggled during the day. The five-year yield rose by 2 basis points to close at 1.32%, and the 10-year yield climbed by 3 bps to 2.15%. The 30-year bond yield fell by 7 bps to 3.04%.

Arizona State sells debt

Heading up the new-issue slate Thursday, Arizona State University offered up $362.26 million of series 2015 refunding bonds. The deal was upsized from $352.01 million.

The offering included $182,645,000 of series 2015A refunding green bonds, $164,615,000 of series 2015B refunding bonds and $15 million of series 2015C taxable bonds, according to the term sheet.

The 2015A bonds are due 2015 and 2019 to 2036 with term bonds due in 2041 and 2046. The serial coupons range from 2% to 5% with 0.10% to 3.22% yields. The 2041 bonds have a 5% coupon and priced at 114.563 to yield 3.31%, and the 2046 bonds have a 4% coupon and priced at 101.677 to yield 3.80%.

The 2015B bonds are due 2015 to 2036 with term bonds due in 2041 and 2046. The serial coupons range from 2% to 5% with 0.10% to 3.22% yields. The 2041 bonds have a 5% coupon and priced at 114.563 to yield 3.31%, and the 2046 bonds have a 4% coupon and priced at 101.677 to yield 3.80%.

The 2015C bonds are due 2016 to 2021, have 0.40% to 2.58% coupons and all priced at par.

The bonds (Aa3/AA/) were sold through Wells Fargo Securities LLC.

Proceeds will be used to refund existing debt.

California sells $1.94 billion

Also on Thursday, California released details on its $1,944,865,000 of series 2015 various purpose general obligation bonds. The deal was upsized from $1.9 billion.

The offering included $931.61 million of series 2015 G.O. bonds and $1,013,255,000 of series 2015 G.O. refunding bonds.

The 2015 G.O. bonds are due 2016 and 2021 to 2033 with term bonds due in 2045. The serial coupons range from 3% to 5% with 0.17% to 3.17% yields. The 2045 bonds have a 4% coupon that priced at 102.645 to yield 3.68% and a 5% coupon that priced at 114.594 to yield 3.27%.

The 2015 G.O. refunding bonds are due 2016 to 2030 with coupons from 1.5% to 5% and yields from 0.17% to 3.17%.

The bonds (Aa3/A+/) were sold through senior managers BofA Merrill Lynch and Morgan Stanley & Co. LLC with Fidelity Capital Markets Inc. as the co-senior manager.

Proceeds will be used to finance capital projects and to repay commercial paper notes.

U of California deal ahead

Another deal out of the Golden State will lead next week’s new offerings. This one comes from the University of California, which is on tap to price $1.66 billion of limited project revenue bonds (Aa3/AA-/AA-) on Thursday.

The deal includes $1.22 billion of series 2015I limited project bonds and $440 million of series 2015J taxable bonds.

The bonds will be offered through Barclays and Raymond James/Morgan Keegan.

Proceeds will be used to finance the construction, acquisition, improvement and renovation of university facilities at 10 campuses and to refund debt.

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