Morning Commentary: Waste Connections, Rentenbank plan high-grade deals; Duke firms

By Cristal Cody

Tupelo, Miss., Nov. 6 – Two issuers are marketing bonds in the high-grade primary market on Tuesday.

Waste Connections, Inc. (Baa2/BBB+/BBB+) is offering 10-year senior notes via BofA Merrill Lynch, J.P. Morgan Securities LLC, MUFG and Wells Fargo Securities, LLC.

Landwirtschaftliche Rentenbank (Aaa/AAA/AAA) also is expected to price an offering of notes due Nov. 14, 2023 that was initially talked to price in the mid-swaps plus 6 basis points area, a source said.

HSBC Securities (USA) Inc., RBC Capital Markets LLC, Societe Generale CIB and TD Securities (USA) LLC are the bookrunners.

Volume was light on Monday with $1.5 billion of issuance from utilities Duke Energy Carolinas LLC and Ameren Illinois Co.

About $15 billion to as much as $30 billion of supply was forecast by market sources for this week, though deal windows will be few with focus scattered on the U.S. mid-term elections Tuesday, conclusion of the Federal Reserve’s monetary policy meeting on Thursday and the upcoming Veterans Day holiday weekend.

In the secondary market, Monday’s session ended with $16.21 billion of bonds traded, according to Trace.

Duke Energy Carolinas’ $1 billion of green first and refunding mortgage bonds that priced in two tranches on Monday tightened about 4 bps across both tranches, according to a market source.

The company (Aa2/A) sold a $350 million tranche of 3.35% bonds due May 15, 2022 at a spread of 38 bps over Treasuries and priced $650 million of 3.95% bonds due Nov. 15, 2028 at a Treasuries plus 80 bps spread.

Ameren Illinois’ $500 million of 4.5% first mortgage bonds due March 15, 2049 (A1/A) firmed about 3 bps in the secondary market after pricing on Monday at a spread of 107 bps over Treasuries, a source said.

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