Published on 2/2/2021 in the Prospect News Investment Grade Daily.
New Issue: Altria prices $5.5 billion of guaranteed notes in four tranches
By Rebecca Melvin
New York, Feb. 2 – Altria Group Inc. has priced $5.5 billion of guaranteed notes (A3/BBB/BBB) in four parts due 2032, 2041, 2051 and 2061, according to a final term sheet filed with the Securities and Exchange Commission on Tuesday.
The $1.75 billion of 2.45% notes due 2032 priced at 99.895 to yield 2.461%, or 138 basis points over Treasuries. The 2032 notes have a make-whole call at Treasuries plus 20 bps until Nov. 4, 2031 and then a par call.
The $1.5 billion of 3.4% notes due 2041 priced at 99.411 to yield 3.441%, or 178 bps over Treasuries. The 2041 notes have a make-whole call at Treasuries plus 25 bps until Aug. 4, 2040 and then a par call.
The $1.25 billion of 3.7% notes due 2051 priced at 99.2658 to yield 3.741%, or a spread to Treasuries of 188 bps. The 2051 notes have a make-whole call at Treasuries pus 30 bps until Aug. 4, 2050, and then a par call.
And the $1 billion of 4% notes due 2061 priced at 99.19 to yield 4.041%, or a spread to Treasuries of 218 bps. The 2061 notes have a make-whole call at Treasuries pus 35 bps until Aug. 4, 2060, and then a par call.
Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Morgan Stanley & Co. LLC and Mizuho Securities USA LLC were joint bookrunning managers of the registered deal.
The securities are guaranteed by Richmond, Va.-based parent Philip Morris USA Inc., a cigarette and smokeless tobacco product maker.
| Issuer: | Altria Group Inc.
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| Guarantor: | Philip Morris USA Inc.
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| Amount: | $5.5 billion
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| Description: | Guaranteed notes
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| Bookrunners: | Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Morgan Stanley & Co. LLC and Mizuho Securities USA LLC
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| Senior co-managers: | Barclays, Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, Santander Investment Securities Inc., Scotia Capital (USA) Inc., U.S. Bancorp Investments Inc. and Wells Fargo Securities LLC
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| Co-managers: | Intesa Sanpaolo SpA, PNC Capital Markets, Academy Securities Inc., Loop Capital Markets LLC and Siebert Williams Shank & Co. LLC
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| Trade date: | Feb. 1
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| Settlement date: | Feb. 4
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| Ratings: | Moody’s: A3
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| S&P: BBB
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| Fitch: BBB
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| Distribution: | SEC registered
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| 2032 notes
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| Amount: | $1.75 billion
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| Maturity: | Feb. 4, 2032
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| Coupon: | 2.45%
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| Price: | 99.895
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| Yield: | 2.461%
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| Spread: | Treasuries plus 138 bps
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| Call: | Make-whole call at Treasuries plus 20 bps before Nov. 4, 2031, then callable at par
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|
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| 2041 notes
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| Amount: | $1.5 billion
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| Maturity: | Feb. 4, 2041
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| Coupon: | 3.4%
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| Price: | 99.411
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| Yield: | 3.441%
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| Spread: | Treasuries plus 178 bps
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| Call: | Make-whole call at Treasuries plus 25 bps before Aug. 4, 2040, then callable at par
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|
|
| 2051 notes
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| Amount: | $1.25 billion
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| Maturity: | Feb. 4, 2051
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| Coupon: | 3.7%
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| Price: | 99.2658
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| Yield: | 3.741%
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| Spread: | Treasuries plus 188 bps
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| Call: | Make-whole call at Treasuries plus 30 bps before Aug. 4, 2050, then callable at par
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|
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| 2061 notes
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| Amount: | $1 billion
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| Maturity: | Feb. 4, 2061
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| Coupon: | 4%
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| Price: | 99.19
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| Yield: | 4.041%
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| Spread: | Treasuries plus 218 bps
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|
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| Call: | Make-whole call at Treasuries plus 35 bps before Aug. 4, 2060, then callable at par
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