GM Financial, Public Service, Alabama Power, GATX sell notes; credit spreads mostly flat

By Cristal Cody

Tupelo, Miss., Nov. 2 – Deal action picked up on Thursday with several high-grade issuers in the primary market.

General Motors Financial Co. Inc. came with a $2 billion three-part offering of senior notes.

Public Service Enterprise Group Inc. sold $700 million of five-year senior notes.

Alabama Power Co. placed $550 million of 30-year notes.

Suncorp-Metway Ltd. priced $500 million of three-year senior notes.

GATX Corp. returned to the primary market for the second time this week with a $200 million offering of four-year senior floating-rate notes.

Also, International Finance Corp. brought a $250 million reopening of its floating-rate notes due Dec. 15, 2022 to the market on Thursday.

In other issuance, Summit Hotel Properties Inc. sold $160 million of 6.25% series E cumulative redeemable preferred stock with a $25.00 per share liquidation preference.

The Markit CDX North American Investment Grade 29 index closed mostly unchanged at a spread of 53 basis points.

GM Financial sells $2 billion

General Motors Financial (Baa3/BBB/BBB-) priced $2 billion of senior notes in three tranches on Thursday, according to an FWP filing with the Securities and Exchange Commission.

The company sold $400 million of three-year floating-rate notes at par to yield Libor plus 54 bps.

The $850 million tranche of 2.45% three-year fixed-rate notes priced at 99.925 to yield 2.476%, or a spread of 75 bps over Treasuries.

In the final slice, General Motors Financial sold $750 million of 3.5% seven-year notes at 99.852 to yield 3.524%. The notes priced with a spread of Treasuries plus 132 bps.

Banco Bradesco BBI SA, Commerz Markets LLC, Credit Agricole Securities (USA) Inc., Deutsche Bank Securities Inc., J.P. Morgan Securities LLC and RBS Securities Inc. were the bookrunners.

The notes are guaranteed by AmeriCredit Financial Services, Inc.

Proceeds will be used for general corporate purposes.

General Motors Financial is the Fort Worth-based finance subsidiary of General Motors Co.

Public Service brings notes

Public Service Enterprise Group sold $700 million of 2.65% five-year senior notes (Baa1/BBB/) on Thursday at 99.873 to yield 2.677%, or a spread of Treasuries plus 68 bps, according to an FWP filing with the SEC.

Barclays, J.P. Morgan Securities, Morgan Stanley & Co. LLC, CIBC World Markets Corp., RBC Capital Markets, LLC and TD Securities (USA) LLC were the bookrunners.

Proceeds will be used for general corporate purposes, including repaying the company’s $500 million term loan in full and repayment of a portion of the company’s commercial paper program debt.

Public Service Enterprise Group is a Newark, N.J., holding company for public electric utility subsidiaries that include Public Service Electric and Gas Co. and PSEG Power LLC.

Alabama Power in market

Alabama Power sold $550 million of 3.7% series 2017B senior notes due Dec. 1, 2047 at 99.871 to yield 3.707% on Thursday, according to an FWP filed with the SEC.

The notes (A1/A-/A+) priced with a spread of 87.5 bps over Treasuries.

Citigroup Global Markets Inc., MUFG, Scotia Capital (USA) Inc., SunTrust Robinson Humphrey Inc. and U.S. Bancorp Investments Inc. were the bookrunners.

Proceeds will be used for general corporate purposes.

Alabama Power is a Birmingham, Ala.-based power company.

Suncorp-Metway taps primary

Suncorp-Metway (A1/A+/A+) priced $500 million of 2.375% three-year senior notes in a Rule 144A and Regulation S offering on Thursday at a spread of Treasuries plus 68 bps, according to a market source.

The notes tightened from initial price talk in the Treasuries plus 75 bps area.

BofA Merrill Lynch, Citigroup Global Markets, Deutsche Bank Securities and RBC Capital Markets were the lead managers.

Suncorp-Metway is a banking and financial services company based in Brisbane, Queensland, Australia.

GATX prices floaters

GATX sold $200 million of senior floating-rate notes due Nov. 5, 2021 (Baa2/BBB/) on Thursday at par to yield Libor plus 72 bps, according to an FWP filing with the SEC.

Morgan Stanley was the bookrunner.

Proceeds will be used to repay $200 million of the company’s outstanding floating-rate term loan balance due March 2, 2022, which bears a current effective interest rate of about 2.568%.

On Tuesday, GATX priced $300 million of 3.5% senior notes due March 15, 2028 at 99.521 to yield 3.556%, or a spread of 118 bps over Treasuries. The issue was expected to close on Thursday.

GATX is a transportation leasing company based in Chicago.

International Finance reopens

International Finance (Aaa/AAA) priced a $250 million reopening of its floating-rate notes due Dec. 15, 2022 on Thursday on top of guidance at Libor plus 6 bps, according to a market source.

BofA Merrill Lynch, Barclays and Citigroup Global Markets were the lead managers.

The company originally sold $500 million of the notes on July 11 at par to yield Libor plus 7 bps.

Washington, D.C.-based International Finance is a member of the World Bank Group.

Summit Hotel sells preferreds

Summit Hotel Properties sold $160 million of 6.25% series E cumulative redeemable preferred stock with a $25.00 per share liquidation preference on Thursday, according to an FWP filed with the SEC,

The deal included 6.4 million shares.

BofA Merrill Lynch, Robert W. Baird & Co. Inc., Raymond James & Associates and RBC Capital Markets were the bookrunners.

Dividends will be payable on the last day of February, May, August and November, beginning Nov. 30, 2017.

The company plans to list the preferreds on the New York Stock Exchange under the ticker symbol “INNPrE.”

Proceeds will be used for the redemption of the $75 million of outstanding 7.875% series B cumulative redeemable preferred stock.

Summit Hotel is an Austin, Texas-based real estate investment trust.

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