Newell Rubbermaid does acquisition deal; JPMorgan also prices; Apple tightens; financials mostly better

By Aleesia Forni and Cristal Cody

New York, March 18 - Newell Rubbermaid Inc. and JPMorgan Chase & Co. entered the high-grade primary market on Friday.

The two new deals ended a week that saw more than $40 billion of new issuance price, with the bulk of that total coming on the heels of the Federal Reserve’s two-day policy meeting and its decision to hold interest rates steady.

In a highly anticipated deal, Newell Rubbermaid priced $8 billion of bonds in six tranches, all a staggering 40 bps to 50 bps inside initial price thoughts.

Proceeds from the deal will be used to help fund the company’s acquisition of Jarden Corp.

And JPMorgan issued $4 billion of bonds in three tranches due March 22, 2019 and April 1, 2026.

Newell Rubbermaid’s notes were seen in the gray market about 15 basis points tighter than where the bonds priced.

JPMorgan Chase’s 4.25% subordinated bonds due 2027 traded about 2 bps softer in the secondary market on the company’s new bond offering.

Apple Inc.’s notes (Aa1/AA+) reopened on Thursday traded about 3 bps better over Friday’s session and 3 bps to 5 bps tighter than where the bonds priced.

In other secondary trading, Morgan Stanley & Co. Inc.’s 3.875% senior notes due 2026 tightened 9 bps over the day.

Mitsubishi UFJ Financial Group, Inc.’s new 3.85% senior notes due 2026 firmed 5 bps.

Goldman Sachs Group Inc.’s 3.75% senior notes due 2026 traded 2 bps better.

And Citigroup Inc.’s 3.7% subordinated notes due 2026 headed out 3 bps tighter.

The Markit CDX North American Investment Grade index closed 2 bps weaker at a spread of 85 bps on Friday.

Funds see inflows

The week also saw inflows into corporate investment-grade funds, with Lipper US Funds Flows reporting more than $1.98 billion of inflows into the asset class for the week ended March 16.

So far, the year has seen more than $1.9 billion of outflows. Last week, high-grade bond funds saw $2.1 billion of inflows.

Newell acquisition financing

Newell Rubbermaid priced $8 billion of senior notes (Baa3/BBB-/BBB-) in six parts on Friday to fund its acquisition of Jarden Corp., according to a market source and an FWP filed with the Securities and Exchange Commission.

All tranches sold on top of final price guidance.

A $1 billion 2.6% tranche of three-year notes sold at 99.977 to yield 2.608%, or Treasuries plus 160 bps.

Also priced was $1 billion of 3.15% five-year notes with a 185 bps spread over Treasuries. The notes sold at 99.835 to yield 3.186%.

A $1.75 billion tranche of 3.85% seven-year notes sold at Treasuries plus 220 bps. Pricing was at 99.969 to yield 3.855%.

The company issued $2 billion of 4.2% 10-year bonds at 99.798 to yield 4.225%, or Treasuries plus 235 bps.

Guidance was at Treasuries plus 235 bps, tightened from talk in the Treasuries plus 275 bps area.

A $500 million 5.375% tranche of 20-year bonds sold at par with a spread of Treasuries plus 270 bps.

Finally, $1.75 billion of 5.5% 30-year bonds sold at 99.636 to yield 5.525%, or Treasuries plus 285 bps.

Goldman Sachs & Co., Citigroup Global Markets Inc., J.P. Morgan Securities LLC and RBC Capital Markets LLC are the bookrunners.

Proceeds will be used to finance the cash consideration portion of the acquisition and to refinance outstanding Jarden debt.

Jarden is a Boca Raton, Fla.-based consumer products company.

Newell Rubbermaid is a consumer and commercial products maker based in Atlanta.

JPMorgan’s three-parter

And JPMorgan Chase priced $4 billion of senior notes (A3/A-) on Friday in three parts, according to an informed source.

The deal included a $1.1 billion tranche of 1.85% three-year notes priced at 99.936 to yield 1.872%, or 87.5 bps over Treasuries.

There was also a $750 million tranche of three-year floating-rate notes sold at par to yield Libor plus 84 bps.

A $2.5 billion 3.3% 10-year piece sold at 99.881 to yield 3.314%, or Treasuries plus 145 bps.

J.P. Morgan Securities LLC is the bookrunner.

The New York City-based financial services company plans to use the proceeds for general corporate purposes.

Freddie Reference notes

Also on Friday, Freddie Mac priced $2.5 billion of 1.125% Reference Notes due April 15, 2019 on Friday at Treasuries plus 12.5 bps, according to a company release.

The notes sold at 99.967 to yield 1.136%.

Barclays, J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC headed the syndicate.

The government-backed mortgage lender is based in McLean, Va.

Newell Rubbermaid firms

Newell Rubbermaid’s 4.2% notes due 2026 were seen in the gray market at 220 bps bid, a trader said.

The 5.375% notes due 2036 were quoted in the gray market at 253 bps bid.

Newell Rubbermaid’s tranche of 5.5% bonds due 2046 traded in the gray market at 269 bps bid.

JPMorgan eases

JPMorgan Chase’s existing 4.25% subordinated bonds due 2027 traded about 2 bps softer on Friday at 206 bps bid, a market source said.

The notes were seen at the start of the day at 199 bps offered.

JPMorgan Chase sold $2 billion of the bonds (Baa1/A-/A) on Sept. 23 at a spread of Treasuries plus 215 bps.

The financial services company is based in New York City.

Apple trades tighter

Apple’s 2.25% notes due 2021 tightened to 52 bps offered in the secondary market on Friday, a trader said.

The company sold a $750 million add-on to the notes on Thursday at Treasuries plus 55 bps.

Apple’s 3.25% bonds due 2026 firmed to 95 bps offered by late afternoon trading.

The company sold $1.25 billion of the notes in an add-on on Thursday at Treasuries plus 100 bps.

Apple’s 4.5% bonds due 2036 traded on Friday at 152 bps offered going out the door.

The bonds were sold in a $1.5 billion add-on in Thursday’s session at Treasuries plus 155 bps.

The computer and mobile communications device company is based in Cupertino, Calif.

Morgan Stanley stronger

Morgan Stanley’s 3.875% notes due 2026 tightened about 9 bps from Thursday’s session to 160 bps bid on Friday, a market source said.

The notes were quoted 4 bps better earlier in the day at 159 bps offered.

Morgan Stanley sold $3 billion of the notes (A3/BBB+/A) on Jan. 22 at 185 bps over Treasuries.

The financial services company is based in New York City.

Mitsubishi tightens

Mitsubishi UFJ Financial Group’s 3.85% notes due 2026 traded 5 bps tighter at 158 bps bid on Friday afternoon, according to a market source.

The company sold $2.5 billion of the notes (A1/A) on Feb. 23 at a spread of Treasuries plus 215 bps.

The financial services company is based in Tokyo.

Goldman firms

Goldman Sachs Group’s 3.75% notes due 2026 firmed 2 bps during the day to 166 bps bid, a market source said.

Goldman sold $1.75 billion of the notes (A3/BBB+/A) on Feb. 22 at a spread of Treasuries plus 203 bps.

The financial services company is based in New York City.

Citigroup improves

Citigroup’s 3.7% notes due 2026 traded 3 bps tighter at 165 bps bid on Friday, a market source said.

Citigroup sold $2 billion of the notes (Baa1/BBB+/A) on Jan. 5 at a spread of Treasuries plus 148 bps.

The financial services company is based in New York.

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