Constellation prices $2.15 billion notes; KeyCorp sells $500 million; high-grade supply light

By Cristal Cody

Tupelo, Miss., Oct. 22 – Constellation Brands, Inc. led high-grade primary action on Monday with a $2.15 billion four-part offering of senior notes that priced on the tight side of guidance.

KeyCorp also sold $500 million of seven-year senior medium-term notes.

Otherwise, investment-grade market activity was light to start the week.

About $15 to $20 billion of deal volume is expected by market sources for the week.

The Markit CDX North American Investment Grade 31 index was flat over the day at a spread of of 67 basis points.

Constellation prices $2.15 billion

Constellation Brands priced $2.15 billion of senior notes (Baa3/BBB/) in four tranches on the tight side of guidance on Monday, according to a market source and FWP filings with the Securities and Exchange Commission.

A $650 million tranche of three-year floating-rate notes priced at par to yield Libor plus 70 bps.

The company sold $500 million of 4.4% seven-year notes at 99.812 to yield 4.431% and a spread of Treasuries plus 130 bps.

Constellation Brands priced $500 million of 4.65% 10-year notes with a Treasuries plus 150 bps spread. The notes priced at 99.72 to yield 4.685%.

A $500 million tranche of 5.25% 30-year notes priced at 99.592 to yield 5.277%, or a spread of 190 bps over Treasuries.

BofA Merrill Lynch, J.P. Morgan Securities LLC, Goldman Sachs & Co. LLC, BNP Paribas Securities Corp., PNC Capital Markets LLC and TD Securities (USA) LLC were the bookrunners.

Constellation Brands is a Victor, N.Y.-based producer, importer and distributor of beer, wine and liquor.

KeyCorp prices $500 million

KeyCorp sold $500 million of 4.15% senior medium-term notes due Oct. 29, 2025 at a spread of 103 bps over Treasuries on Monday, on the tight side of guidance, according to a market source and an FWP filing with the SEC.

The notes (Baa1/BBB+/A-) priced at 99.934 to yield 4.161%.

KeyBanc Capital Markets Inc., Goldman Sachs, J.P. Morgan Securities and Morgan Stanley & Co. LLC were the bookrunners.

Cleveland, Ohio-based KeyCorp is a financial services company and parent company of KeyBank.

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