International Paper brings $1.5 billion; Halliburton sells $1 billion; HP firms; Hershey flat

By Sheri Kasprzak and Cristal Cody

New York, Nov. 8 - It was another busy day for primary action, with a number of significant sales coming to the table.

The action was led by International Paper Co., which brought to market $1.5 billion of notes in two tranches Tuesday to help fund the company's planned acquisition of Temple-Inland Inc.

Other major deals priced from Halliburton Co. and Teva Pharmaceutical Industries Ltd.

In the secondary market, International Paper's debt traded stronger in the afternoon.

Bonds were better on the day, and the Markit CDX Series 17 North American Investment Grade index firmed 3 basis points to a spread of 121 bps.

Elsewhere in trading, Amgen Inc.'s $6 billion offering of senior notes in four tranches traded mixed on Tuesday, with the longer-dated debt wider, a source said.

Hewlett-Packard Co.'s 4.375% notes due 2021 have firmed nearly 60 bps since they priced in September, a trader said Tuesday.

Hershey Co.'s new notes due 2016 traded wrapped around issuance of 67 bps, a trader said.

The notes due 2016 traded going out flat at 67 bps bid, 64 bps offered.

Bank credit default swap costs were flat to 8 bps tighter, and brokerage CDS costs traded down 5 bps.

Overall trading volume rose to about $11 billion on Tuesday from about $8 billion the previous day.

Treasuries ended lower on the long end of the bond curve. The 10-year note yield rose to 2.08% from 2.03%. The 30-year bond yield rose 3 basis points to 3.13%.

International Paper prices

International Paper's offering included $900 million of 11-year notes and $600 million of 30-year notes (Baa3/BBB/).

The 10-year notes have a 4.75% coupon and a spread of Treasuries plus 270 bps. They priced at 99.919 to yield 4.761%.

The 30-year notes have a 6% coupon. The notes were priced at a spread of Treasuries plus 290 bps. They priced at 99.986 to yield 6.001%.

The joint bookrunning managers were UBS Investment Bank LLC, Deutsche Bank Securities Inc., BNP Paribas, HSBC Securities (USA) LLC and RBS Securities Inc.

Proceeds will be used, together with borrowings under a term loan facility and cash, to acquire the outstanding common stock of Temple-Inland, to fund the prepayment of Temple credit facilities and to pay additional expenses connected to the acquisition. If the merger is not completed before June 30, 2012, the company intends to redeem the notes at 101.

In the secondary market, both tranches traded stronger, sources said.

International Paper's notes due 2022 firmed to 254 bps bid, 222 bps offered, one trader said.

The bonds due 2041 tightened also in trading to 285 bps bid, 282 bps offered.

A trader at another desk saw $5 million of the notes due 2022 trading at 258 bps bid and $5 million of the long bonds at 287 bps bid.

International Paper is based in Memphis and produces uncoated papers and packaging products.

Halliburton prices notes

Elsewhere in the market, Halliburton priced $1 billion of senior notes(A2/A/), said a term sheet filed with the Securities and Exchange Commission.

The offering included $500 million of 10-year notes and $500 million of 30-year notes.

The 10-year notes have a 3.25% coupon and a spread of Treasuries plus 120 bps. The notes were priced at 99.67 to yield 3.289%.

The 30-year notes have a 4.5% coupon and a spread of Treasuries plus 140 bps. They were priced at 99.494 to yield 4.531%.

The joint bookrunners for the notes are Citigroup Global Markets Inc., Deutsche Bank, HSBC, RBS, Credit Suisse Securities (USA) LLC and Morgan Stanley & Co. LLC.

Proceeds will be used for general corporate purposes.

Based in Houston, Halliburton is an oilfield services company.

Teva prices Israel's largest

In recent offerings, Teva Pharmaceutical Industries sold $5 billion of senior notes (A3/A-/) in six tranches, according to a statement from the company and a term sheet.

The deal, according to the company's chief financial officer, went well considering market conditions.

"Teva's ability to raise this amount in a volatile market is a testament to our strength, as well as to the market's confidence in our business performance and ability to continue to generate free cash flow," Eyal Desheh, the company's CFO, said in a statement released Tuesday.

"In addition to being the largest offering ever done by an Israeli company, we had demand substantially in excess of the final order book."

Deal done in six tranches

The offering was comprised of $200 million of floating-rate senior notes issued through Teva Pharmaceutical Finance IV, LLC, $1.1 billion of floating-rate senior notes issued through Teva Pharmaceutical Finance BV, $1 billion of fixed-rate senior notes issued through Teva LLC, $950 million of fixed-rate senior notes issued through Teva BV, $875 million of fixed-rate senior notes issued through Teva BV and $875 million of fixed-rate senior notes issued through Teva Pharmaceutical Finance IV BV.

The $200 million of floating-rate bonds are due May 8, 2013, bear interest at Libor plus 80 bps and were priced at par. The notes are not callable.

The $1.1 billion of floating-rate notes are due Nov. 8, 2013 and bear interest at Libor plus 90 bps. The notes priced at par and are not callable.

The $1 billion of notes are due Nov. 10, 2014, bear interest at 1.7% and were priced at a spread of Treasuries plus 135 bps. The notes were priced at 99.869 to yield 1.745%. The notes feature a make-whole call at Treasuries plus 20 bps.

The $950 million of notes are due Nov. 10, 2016, bear interest at 2.4% and were priced at a spread of Treasuries plus 150 bps. The notes were priced at 99.916 to yield 2.418%. The notes feature a make-whole call at Treasuries plus 25 bps.

The $875 million of notes issued through Teva BV are due Nov. 10, 2021, bear interest at 3.65% and were priced at a spread of Treasuries plus 170 bps. The notes were priced at 99.635 to yield 3.694%. Those notes also feature a make-whole call at Treasuries plus 30 bps.

The $875 million of notes issued through Teva Pharmaceutical Finance IV are due Nov. 10, 2021, bear interest at 3.65% and were priced at a spread of Treasuries plus 170 bps. The notes were priced at 99.635 to yield 3.694%. The notes feature a make-whole call at Treasuries plus 30 bps.

The notes were offered through joint bookrunners Barclays Capital Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. and Morgan Stanley & Co. LLC.

Proceeds from the offering will be used to repay borrowings under bridge loans due on Dec. 3, 2011 and March 9, 2012, to repay borrowings under the company's revolving credit facility due June 13, 2014 and to repay borrowings under its revolver due Jan. 20, 2014. The remainder will be used for the conversion of 2% convertible senior subordinated notes due June 1, 2015 and for general corporate purposes.

The bonds were mixed in the secondary market.

The notes due 2014 firmed 5 bps to 130 bps bid, a trader said.

The tranche of notes due 2016 edged moderately tighter to 149 bps bid, 145 bps offered.

The notes due 2021 issued through Teva BV widened to 172 bps bid, 166 bps offered.

The tranche of notes due 2021 issued through Teva Pharmaceutical Finance IV widened to 175 bps bid, 170 bps offered, the trader said.

Based in Petach Tivka, Israel, Teva Pharmaceutical Finance is the financing arm of Teva Pharmaceuticals, which makes generic forms of drugs.

Amerisource prices debt

In other primary action, AmerisourceBergen Corp. sold $500 million of senior notes, said a term sheet.

The 3.5% notes (Baa2/A-/A-) are due Nov. 15, 2021 and were priced at a spread of Treasuries plus 150 bps. The notes were priced at 99.858 to yield 3.517%.

The joint bookrunning managers for the notes were Bank of America Merrill Lynch, J.P. Morgan Securities LLC and Wells Fargo Securities LLC.

Proceeds will be used for general corporate purposes.

Based in Chesterbrook, Pa., AmerisourceBergen provides drug distribution and related services to pharmaceutical manufacturers.

Amgen mixed

Amgen's offering included $1 billion of three-year notes, $1 billion of five-year notes, $1.75 billion of 10-year notes and $2.25 billion of 30-year notes.

In the secondary market, the 1.875% notes due 2014 firmed to 145 bps bid from the issue price of 150 bps, a trader said.

The 2.5% notes due 2016 edged wider to 163 bps bid, 161 bps offered from the issue price of price of Treasuries plus 162.5 bps.

The tranche of 5.15% bonds due 2041 traded wider at 220 bps bid, 219 bps offered. The bonds priced at a spread of Treasuries plus 212.5 bps.

Thousand Oaks, Calif.-based Amgen manufactures and markets human therapeutics.

HP tightens

Hewlett-Packard's 4.375% notes due 2021 traded at 182 bps bid, 172 bps offered on Tuesday, nearly 60 bps tighter than the issue price, a trader said.

Hewlett-Packard sold $1 billion of the 10-year notes at a spread of 240 bps over Treasuries on Sept. 13.

The information technology company is based in Palo Alto, Calif.

Paul Deckelman contributed to this report

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