New Issue: IBM taps market for $1.5 billion of three-, seven-year notes

By Andrea Heisinger

New York, May 8 - International Business Machines Corp. sold $1.5 billion of notes (Aa3/A+/A+) in two tranches on Tuesday, a market source said.

A $900 million tranche of 0.75% three-year paper priced at 99.834 to yield 0.806% with a spread of Treasuries plus 45 basis points. The notes sold at the tight end of guidance in the 45 bps to 47 bps range.

There was a second tranche of $600 million in 1.875% seven-year paper priced at 99.85 to yield 1.898% with a spread of Treasuries plus 65 bps. The notes were priced at the tight end of talk that was the 70 bps area.

Bookrunners were Barclays Capital Inc., HSBC Securities (USA) Inc., J.P. Morgan Securities LLC and RBS Securities Inc.

Proceeds will be used for general corporate purposes.

IBM was in the market with a $2.5 billion deal in two parts on Feb. 1. A 0.55% three-year note from that offering priced at 42 bps over Treasuries.

The information technology and computer company is based in Armonk, N.Y.

Issuer:	International Business Machines Corp.
Issue:	Notes
Amount:	$1.5 billion
Bookrunners:	Barclays Capital Inc., HSBC Securities (USA) Inc., J.P. Morgan Securities LLC, RBS Securities Inc.
Trade date:	May 8
Ratings:	Moody's: Aa3
	Standard & Poor's: A+
	Fitch: A+
Three-year notes
Amount:	$900 million
Maturity:	2015
Coupon:	0.75%
Price:	99.834
Yield:	0.806%
Spread:	Treasuries plus 45 bps
Price talk:	45 bps to 47 bps
Seven-year notes
Amount:	$600 million
Maturity:	2019
Coupon:	1.875%
Price:	99.85
Yield:	1.898%
Spread:	Treasuries plus 65 bps
Price talk:	70 bps area

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