High-grade supply quiet; Fidelity, Avangrid, Nstar deals eyed; IBM eases; Bristol-Myers firms

By Cristal Cody

Tupelo, Miss., May 10 – The investment-grade primary market was quiet on Friday after issuers this week priced more than $45 billion of bonds, including the year’s two biggest deals.

In other action, Fidelity National Information Services, Inc. finished a week-long roadshow on Friday with plans to price a multi-currency bond deal to help finance its acquisition of Worldpay Inc.

Also on Friday, New Haven, Conn.-based electric and gas utility Avangrid, Inc. held fixed income investor calls for a possible green bond offering, a source said. Citigroup Global Markets Inc., Credit Agricole Securities (USA) Inc., MUFG and Wells Fargo Securities LLC are the arrangers.

Coming up on Monday, Nstar Electric Co. plans to hold fixed income investor calls for a dollar-denominated green bond offering.

Volume in the week ahead is expected to remain strong but was hard to peg following the heavy issuance this week and trade concerns.

About $25 billion of supply is forecast for the week ahead, sources report.

The Markit CDX North American Investment Grade 32 index recovered more than 1 basis point on Friday to end at a spread of 62 bps.

In the secondary market, new issues were mostly better, with bonds from International Business Machines Corp. and Bristol-Myers Squibb Co. mixed.

IBM’s notes priced in eight tranches on Wednesday were seen about 3 bps to 8 bps wider than issuance.

Bristol-Myers’ notes were quoted flat to about 8 bps tighter than where the nine-part offering priced on Tuesday.

Meanwhile, purchases of high-grade corporate, Treasuries, agencies and mortgage bonds increased to $3.85 billion for the week ended May 8 from $2.12 billion in the prior week, “as stronger inflows to high grade, government bonds and munis more than offset outflows from high yield and leveraged loans,” Yuri Seliger, an analyst with BofA Merrill Lynch, said in a report released on Friday.

Inflows to the high-grade space climbed to $3.1 billion for the week from $2.47 billion the previous week.

“The increase was entirely driven by inflows to short-term high grade,” Seliger said.

Short-term high-grade inflows rose to $920 million from $300 million a week ago.

Flows excluding short-term were steady at $2.17 billion.

Inflows to high-grade funds declined to $1.98 billion from $2.97 billion, while ETF flows turned positive with a $1.12 billion inflow this past week after a $500 million outflow in the prior week, he said.

Nstar in pipeline

Nstar Electric, doing business as Eversource Energy, (A2/A+/A) plans to hold fixed income investor calls on Monday for a dollar-denominated green bond offering, according to a market source.

BofA Merrill Lynch, Barclays, Citigroup Global Markets and TD Securities (USA) LLC are the arrangers.

The Boston-based company operates in the energy delivery business through utility subsidiaries.

IBM widens

International Business Machines’ 3.25% notes due May 15, 2029 traded on Friday at 108 bps bid, 105 bps offered, a market source said.

IBM sold $3.25 billion of the 10-year notes (A1/A/A) as part of a $20 billion eight-tranche offering on Wednesday at a spread of 105 bps over Treasuries.

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

Bristol-Myers firms

Bristol-Myers Squibb’s 3.4% senior notes due July 26, 2029 tightened to 100 bps bid, 98 bps offered in secondary trading, according to a market source.

Bristol-Myers sold $4 billion of the 10-year notes (A2/A+/) on Tuesday at a Treasuries plus 105 bps spread.

The notes priced as part of a $19 billion nine-tranche offering.

Bristol-Myers Squibb is a biopharmaceutical company based in New York.

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