NextEra, MidAmerican Energy, Marriott, Owl Rock price; European Investment Bank in pipeline

By Cristal Cody

Tupelo, Miss., Oct. 1 – NextEra Energy Capital Holdings Inc. led deal volume in the high-grade primary market on Tuesday with a $1 billion offering of 10-year guaranteed debentures.

MidAmerican Energy Co. came by to bring $850 million of green first mortgage bonds in new and reopened tranches during the session.

Marriott International Inc. priced $550 million of three-year senior notes.

In addition, Owl Rock Capital Corp. sold $425 million of long five-year senior notes.

Meanwhile, the European Investment Bank is marketing $1 billion of 10-year global notes to price on Wednesday.

High-grade volume week to date totals more than $6 billion.

Supply is expected to slow in October after the busiest September on record in the high-grade bond market, sources report.

About $10 billion to $15 billion of issuance is anticipated by syndicate sources this week, while October is forecast to see about $80 billion to $90 billion of total supply.

The Markit CDX North American Investment Grade 33 index closed nearly 1 basis point softer on the day at a spread of 60.6 bps.

In the secondary market, Diageo Capital plc’s $1.6 billion of guaranteed notes (A3/A-/) priced in two tranches on Monday traded flat to about 8 bps tighter than issuance, according to a market source.

The $1 billion tranche of 2.375% notes due Oct. 24, 2029 improved 8 bps.

The 10-year notes priced on top of guidance at a Treasuries plus 80 bps spread.

The notes are guaranteed by London-based premium drink company Diageo plc.

NextEra prices $1 billion

NextEra Energy Capital Holdings sold $1 billion of 2.75% 10-year guaranteed debentures (Baa1/BBB+/A-) on Tuesday at 99.597 to yield 2.796%, according to an FWP filed with the Securities and Exchange Commission.

The debentures priced with a spread of 115 bps over Treasuries.

The bonds originally were issued in August 2016 as part of NextEra Energy, Inc.'s equity units.

Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, MUFG, Barclays, KeyBanc Capital Markets LLC, Regions Securities LLC, SunTrust Robinson Humphrey Inc. and U.S. Bancorp Investments Inc. were the bookrunners.

The debentures are guaranteed by NextEra Energy Capital Holdings’ parent company, NextEra Energy, Inc.

NextEra Energy is an energy company based in Juno Beach, Fla.

MidAmerican sells green bonds

MidAmerican Energy sold $850 million of green first mortgage bonds (Aa2/A+/) in new and reopened tranches on Tuesday, according to a market source.

The company priced a $250 million tap of its 3.65% bonds due April 15, 2029 at a spread of 75 bps over Treasuries. Initial price talk was in the 90 bps spread area.

MidAmerican Energy first priced $600 million of the bonds on Jan. 7 at 99.911 to yield 3.661%, or a spread of 97 bps over Treasuries. The total outstanding is now $850 million.

A $600 million tranche of 3.15% bonds due April 15, 2050 priced at a Treasuries plus 107 bps spread. The bonds were initially talked in the Treasuries plus 125 bps spread area.

Citigroup, Mizuho Securities USA LLC, MUFG, U.S. Bancorp, Wells Fargo Securities LLC and Scotia Capital (USA) Inc. were the bookrunners.

MidAmerican Energy is a utility company based in Des Moines.

Marriott raises $550 million

Marriott International priced $550 million of 2.125% senior notes due Nov. 1, 2022 (Baa2/BBB/) on Tuesday at a spread of 70 bps over Treasuries, according to a market source.

Initial price talk was in the Treasuries plus 85 bps area.

J.P. Morgan and U.S. Bancorp were the bookrunners.

Proceeds will be used for general corporate purposes.

The lodging company is based in Bethesda, Md.

Owl Rock prices $425 million

Owl Rock Capital priced $425 million of senior notes due March 30, 2025 (Baa3/BBB-/BBB-) on Tuesday at a spread of Treasuries plus 260 bps, according to a market source and a 497AD filing with the SEC.

Initial price talk was in the Treasuries plus 275 bps spread area with guidance firmed to the Treasuries plus 265 bps area.

The notes priced at 99.476 to yield 4.108%.

BofA Securities, Inc. was the active bookrunner. Joint bookrunners were Deutsche Bank Securities Inc., Goldman Sachs, ING Financial Markets LLC, MUFG, RBC Capital Markets, LLC, SMBC Nikko Securities America, Inc., SG Americas Securities LLC and SunTrust.

Owl Rock Capital held fixed income investor calls on Wednesday and Thursday.

The New York-based middle-market debt and equity asset management company plans to use the proceeds to repay borrowings under its revolving credit facility that matures April 2, 2024.

European Investment Bank on deck

The European Investment Bank (Aaa/AAA/AAA) plans to price $1 billion of 10-year global notes on Wednesday, according to a market source.

Initial price talk is in the mid-swaps plus 21 bps area.

Barclays, Citigroup, J.P. Morgan and Skandinaviska Enskilda Banken are the bookrunners.

The lender for the European Union is based in Kirchberg, Luxembourg.

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