Boston Properties, Southern price notes; light deal supply forecast; Anthem tightens

By Cristal Cody

Tupelo, Miss., Nov. 17 – Two high-grade issuers tapped the primary market on Friday.

Boston Properties LP priced $850 million of long seven-year senior notes.

Southern Co. sold $450 million of $25-par series 2017B junior subordinated notes due Dec. 1, 2077.

More than $25 billion of corporate bonds have priced over the week.

Deal supply is expected to thin to the $5 billion to $10 billion area in the week ahead with the Thanksgiving Day holiday, according to market sources.

Bonds were mostly mixed in secondary trading on Friday.

Boston Properties’ notes traded wrapped around issuance.

Anthem, Inc.’s $5.5 billion of senior notes (Baa2/A/BBB) priced in five tranches on Tuesday traded about 5 basis points to 11 bps better in the secondary market on Friday.

The Markit CDX North American Investment Grade 29 index closed modestly tighter at a spread of 55 bps.

Boston Properties prices

Boston Properties priced $850 million of 3.2% senior notes due Jan. 15, 2025 (Baa2/A-/BBB+) on Friday at 99.757 to yield 3.238%, or a spread of 100 bps over Treasuries, according to a market source and an FWP filing with the Securities and Exchange Commission.

The notes priced on the tight side of guidance in the Treasuries plus 105 bps area, plus or minus 5 bps.

BNY Mellon Capital Markets LLC, Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, BofA Merrill Lynch, Morgan Stanley & Co. LLC, Jefferies LLC, Scotia Capital (USA) Inc., TD Securities (USA) LLC and Wells Fargo Securities LLC were the bookrunners.

Proceeds will be used for debt repayment, including the redemption of the company’s 3.7% senior notes due 2018, and for general business purposes.

Boston-based Boston Properties is the operating subsidiary of real estate investment trust Boston Properties, Inc.

Southern sells $450 million

Southern priced $450 million of 5.25% $25-par series 2017B junior subordinated notes due Dec. 1, 2077 (Baa3/BBB/BBB) on Friday, according to a market source and an FWP filing with the SEC.

The notes priced on the tight side of initial talk in the 5.25% to 5.375% area.

J.P. Morgan Securities, BofA Merrill Lynch, Morgan Stanley, UBS Securities LLC and Wells Fargo Securities were the bookrunners.

There will not be an over-allotment option.

The new securities will be listed on the New York Stock Exchange.

Proceeds will be used to pay a portion of outstanding short-term debt and for other general corporate purposes, including investments in subsidiaries.

Southern is an Atlanta-based electric utility company.

Anthem notes firm

Anthem’s 3.65% notes due Dec. 1, 2027 tightened to 123 bps bid, 120 bps offered in the secondary market, a source said on Friday.

Anthem priced $1.6 billion of 3.65% notes on Tuesday at a spread of Treasuries plus 130 bps.

The company’s 4.375% notes due Dec. 1, 2047 were quoted at 144 bps bid, 142.5 bps offered in afternoon trading.

Anthem sold $1.4 billion of the notes in Tuesday’s offering at a spread of 155 bps over Treasuries.

The health benefits company is based in Indianapolis.

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