Molex, Sweden’s Stadshypotek price; Verizon, AT&T improve; Apple, Microsoft ease

By Aleesia Forni and Cristal Cody

Virginia Beach, April 1 – Molex Electronic Technologies LLC and Sweden's Stadshypotek AB were in Wednesday’s primary market kicking off the new month on a positive note.

Investors piled into Molex Electronic’s debut $1 billion deal, which attracted an order book of more than $5 billion.

The company was able to pull in pricing on both tranches of its new issue by around 32.5 basis points compared to initial price thoughts.

In its first dollar deal in more than two years, Stadshypotek offered a $1 billion five-year covered bond in line with talk.

The day’s two deals push the week’s total new issuance to $3,925,000,000, far short of what was predicted to be around a $15 billion week.

With a large portion of market participants away from their desks, Thursday is unlikely to see much, if any, primary activity ahead of the Easter holiday.

High-grade credit spreads were flat to modestly tighter, a source said.

The Markit CDX North American Investment Grade series 23 index headed out flat at a spread of 64 bps.

In the secondary market, Verizon Communications Inc.’s 4.15% notes due 2024 traded 4 bps better.

AT&T Inc.’s 3.9% notes due 2024 improved 1 bp over the day.

Apple Inc.’s 2.5% notes due 2025 eased 1 bp in secondary trading.

Microsoft Corp.’s 2.7% notes due 2025 traded 4 bps wider.

Molex Electronic bond

Molex Electronic Technologies priced a $1 billion issue of senior notes (Baa3/BBB/) on Wednesday in tranches due 2020 and 2025, according to an informed source.

The sale included $500 million of 2.878% five-year notes priced at par with a spread of Treasuries plus 155 bps.

The notes sold tighter than guidance set in the Treasuries plus 165 bps area. Initial talk was set in the 187.5 bps area over Treasuries.

There was also a $500 million tranche of 3.9% 10-year notes sold at 99.843 to yield 3.919%, or Treasuries plus 205 bps.

Pricing was tighter than the Treasuries plus 215 bps area guidance, which firmed from initial talk set in the 237.5 bps area over Treasuries.

The bookrunners were BofA Merrill Lynch, J.P. Morgan Securities LLC, Wells Fargo Securities LLC, Standard Chartered Bank and SMF Group.

Proceeds will be used to repay debt.

The sale was done via Rule 144A and Regulation S.

Molex is a Lisle, Ill.-based manufacturer and seller of electronic components.

Stadshypotek covered bond

Sweden's Stadshypotek priced $1 billion of 1.75% five-year covered bonds on Wednesday at mid-swaps plus 37 bps, or Treasuries plus 54.2 bps, a market source said.

The notes sold in line with talk set in the high-30 bps area over mid-swaps.

Pricing was at 99.439 to yield 1.868%.

The deal was done under Rule 144A and Regulation S.

The bonds are backed by prime Swedish residential mortgages.

Bookrunners were BofA Merrill Lynch, JPMorgan, Morgan Stanley & Co. LLC and RBC Capital Markets LLC.

The mortgage company and subsidiary of Svenska Handelsbanken AB is based in Stockholm.

Verizon tightens

Verizon’s 4.15% notes due 2024 tightened 4 bps to 132 bps bid on Wednesday, according to a market source.

Verizon sold $1.25 billion of the notes (Baa1/BBB+/A-) on March 10, 2014 at Treasuries plus 140 bps.

The telecommunications company is based in New York City.

AT&T firms

AT&T’s 3.9% notes due 2024 (Baa1/BBB+/A-) firmed 1 bp to 135 bps bid during the session, a source said.

AT&T sold $1 billion of the notes on March 5, 2014 at Treasuries plus 125 bps.

The telecommunications company is based in Dallas.

Apple softer

Apple’s 2.5% notes due 2025 traded 1 bp softer over the session at 86 bps bid, according to a market source.

Apple sold $1.5 billion of the notes (Aa1/AA+/) on Feb. 2 at Treasuries plus 85 bps.

The computer and mobile communications device company is based in Cupertino, Calif.

Microsoft eases

Microsoft’s 2.7% notes due 2025 eased 4 bps to 75 bps bid in trading on Wednesday, a market source said.

Microsoft sold $2.25 billion of the notes (Aaa/AAA/) on Feb. 9 at Treasuries plus 75 bps.

The computer software company is based in Redmond, Wash.

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