Morning Commentary: W.R. Berkley $25-par notes added to pipeline; eBay notes free; market soft

By Stephanie N. Rotondo

Seattle, Feb. 23 – The preferred stock space saw another new deal hitting the tape on Tuesday, as W.R. Berkley Corp. announced an offering of $25-par subordinated debentures due 2056.

The notes were being talked in a 5.9% area, with at least $150 million of the notes to be sold.

A trader said he had yet to see any quotes in the gray market.

BofA Merrill Lynch, J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and Wells Fargo Securities LLC are running the books.

Meanwhile, eBay Inc.’s $750 million of 6% $25-par notes due 2056 – a deal priced Monday – had freed to trade by mid-morning, according to a trader.

The paper was pegged at $24.82 bid, $24.90 offered.

That deal came upsized from $250 million. Initial price talk was in a 6.125% to 6.25% range but was later revised to 6%.

BofA Merrill Lynch, JPMorgan, Morgan Stanley and Wells Fargo also led that deal.

Away from new issues, the preferred stock market was following the broader markets downward in early Tuesday trading.

The Wells Fargo Hybrid and Preferred Securities index was off 33 basis points at mid-morning.

A trader noted that long Treasuries were weak on the day, as was oil.

“Consumer confidence numbers came in this morning and were worse than expected,” he said. However, home sales came in better than expected.

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