Vulcan, Daimler, Snap-on tap primary market; Bank Nederlandse eyes benchmark issuance

By Cristal Cody

Tupelo, Miss., Feb. 20 – Three high-grade companies tapped the primary market on Tuesday following the long holiday weekend with some issuers choosing to stand down during the session, according to market sources.

Vulcan Materials Co. priced $850 million of notes in a deal that featured one Securities and Exchange Commission-registered offering and one Rule 144A and Regulation S issue.

Daimler Finance North America LLC came with a $750 million add-on to its three-year senior floating-rate notes that were first priced in the previous week.

Also, Snap-on Inc. priced $400 million of 30-year notes during the session.

U.S. high-grade supply is expected to stay light over the week with some market sources predicting as little as $10 billion of volume.

Deal action has been quiet for more than a week in the Canadian dollar-denominated high-grade bond market, a syndicate source said.

“We haven’t had a deal in some time,” the source said. “There’s a reasonable amount of issuers in the pipeline. They’re just looking for a little more stability in Canada.”

Coming up on Wednesday, Bank Nederlandse Gemeenten NV is looking to price a benchmark-sized dollar-denominated deal.

The Markit CDX North American Investment Grade 29 index ended the day about 2 basis points wider at a spread of 53 bps.

Vulcan brings two tranches

Vulcan Materials priced $850 million of notes (Baa3/BBB/BBB-) in two tranches on Tuesday, according to a market source, news release and an FWP filing with the SEC.

The company sold $500 million of three-year floating-rate notes in an SEC-registered offering at par to yield Libor plus 65 bps.

The deal was upsized from $300 million and priced on the tight side of talk in the Libor plus 70 bps area.

Vulcan Materials also sold $350 million of 4.7% 30-year notes in a Rule 144A and Regulation S private placement at 99.887 to yield a spread of Treasuries plus 155 bps, on the tight side of guidance in the Treasuries plus 160 bps area.

Goldman Sachs & Co., U.S. Bancorp Investments Inc., Wells Fargo Securities LLC, BofA Merrill Lynch, Regions Securities LLC and SunTrust Robinson Humphrey Inc. were the bookrunners.

Proceeds will be used for general corporate purposes, including debt repayment.

Vulcan Materials is a Birmingham, Ala., producer of construction aggregates.

Daimler Finance reopens

Daimler Finance North America priced a $750 million add-on to its senior floating-rate notes due Feb. 22, 2021 (A2/A/) at Libor plus 45 bps on Tuesday, according to a market source.

The company originally sold $400 million of the notes on Thursday at Libor plus 45 bps.

BBVA Securities Inc., Citigroup Global Markets Inc., HSBC Securities (USA) Inc., J.P. Morgan Securities, LLC, Societe Generale and TD Securities (USA) LLC were the bookrunners.

Daimler Finance is a Wilmington, Del.-based financing arm of Daimler North America Corp.

Snap-on prices bonds

Snap-on priced $400 million of 4.1% 30-year notes (A2/A-/A) on Tuesday at a spread of 95 bps over Treasuries, according to an FWP filing with the SEC.

The bonds priced at 99.725 to yield 4.116%.

Citigroup Global Markets, J.P. Morgan Securities and U.S. Bancorp Investments were the bookrunners.

Proceeds will be used to purchase for cash any and all of the company’s $200 million of outstanding 6.7% senior notes due March 1, 2019, to repay a portion of the company’s outstanding commercial paper and for general corporate purposes.

The tool and equipment manufacturer is based in Kenosha, Wis.

BNG offers notes

Bank Nederlandse Gemeenten (Aaa/AAA/AA+) is offering a benchmark-sized dollar-denominated offering of two-year notes on Wednesday, according to a market source.

The notes due Feb. 28, 2020 were initially talked to price with a spread in the mid-swaps plus 5 bps area.

BofA Merrill Lynch, BMO Capital Markets Corp., Barclays and Nomura Securities International, Inc. are the lead managers for the Rule 144A and Regulation S transaction.

The banking services company is based in The Hague.

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