Occidental Petroleum, Omnicom, NextEra Energy Capital open week; Apple active; FedEx improves

By Aleesia Forni and Cristal Cody

New York, March 28 – Occidental Petroleum Corp., Omnicom Group Inc. and NextEra Energy Capital Holdings Inc. priced bond deals to open the week on Monday.

Issuers brought to market $4.65 billion during a quieter session. A number of markets, including Europe, were closed for Easter Monday.

Still, demand was strong for the trio of deals that did make their way to the primary during the trading day.

Occidental attracted nearly $11 billion of orders for its $2.75 billion three-part issue of notes.

And Omnicom tightened the spread on its $1.4 billion 10-year notes by around 25 basis points compared to initial price thoughts.

There was also a $500 million three-year note priced by energy company NextEra to round out the day’s new deals, while Franklin Financial Network Inc. announced plans to sell an offering of fixed-to-floating-rate subordinated notes.

Sources are calling for around $15 billion to $20 billion of new investment-grade issuance this week.

Apple Inc.’s bonds priced in February were active in the secondary market on Monday and remain stronger than issuance.

FedEx Corp.’s 4.55% bonds due 2046 closed better on the day.

The Markit CDX North American Investment Grade index ended unchanged at a spread of 83 bps.

Occidental three-parter

Occidental Petroleum sold $2.75 billion of senior notes (A3/A/A) in three tranches on Monday, all 20 bps to 25 bps inside initial price thoughts, according to an informed source and a filing with the Securities and Exchange Commission.

A $400 million tranche of 2.6% six-year notes priced at 99.95 to yield 2.609%, or Treasuries plus 125 bps.

The notes sold at the tight side of guidance set in the Treasuries plus 130 bps area, tightened from talk in the Treasuries plus 145 bps area.

And $1.15 billion of 3.4% 10-year notes priced with a 155 bps spread over Treasuries. The notes priced at 99.772 to yield 3.427%.

Guidance was in the Treasuries plus 160 bps area. Initially, talk was in the Treasuries plus 180 bps area.

Finally, $1.2 billion of 4.4% 30-year notes sold at 99.224 to yield 4.447%, or Treasuries plus 180 bps.

Pricing came at the tight end of guidance set in the Treasuries plus 185 bps area, which tightened from the Treasuries plus 205 bps area.

BofA Merrill Lynch, Citigroup Global Markets Inc., J.P. Morgan Securities LLC and Wells Fargo Securities LLC are the active bookrunners. Passive bookrunners are HSBC Securities (USA) Inc., MUFG, Mizuho Securities USA Inc., SG Americas Securities, LLC, SMBC Nikko Securities America, Inc. and U.S. Bancorp Investments, Inc.

Proceeds will be used to refinance the company’s $750 million of 4.125% notes due June 2016 and $1.25 billion of 1.75% notes due February 2017 and for general corporate purposes.

The oil and gas, chemical and midstream company is based in Los Angeles.

Omnicom prices tight

Omnicom Group and Omnicom Capital Inc. sold $1.4 billion of 3.6% 10-year senior notes (Baa1/BBB) at Treasuries plus 175 bps on Monday, according to a market source, at the tightest side of guidance set in the 180 bps area over Treasuries.

Pricing was at 99.907 to yield 3.611%.

Initially, talk was in the 200 bps area over Treasuries.

Citigroup, Deutsche Bank Securities Inc., JPMorgan and Wells Fargo were the active bookrunners, and BNP Paribas Securities Corp., HSBC and U.S. Bancorp were the passive bookrunners.

The portion of notes issued by Omnicom Capital is guaranteed by Omnicom Group.

Proceeds will be used to retire $1 billion of 5.9% notes due April 15, 2016 and for general corporate purposes, which may include working capital, fixed asset expenditures, acquisitions, debt refinancing, repurchases of common stock or other capital transactions.

The marketing and corporate communications company is based in New York City.

NextEra three-years

NextEra Energy Capital Holdings sold $500 million of 2.3% three-year senior notes (Baa1/BBB+/A-) at Treasuries plus 130 bps on Monday, according to an FWP filing with the SEC.

Pricing was at 99.899 to yield 2.335%.

Guidance was in the Treasuries plus 135 bps area following talk in the 155 bps area over Treasuries.

The notes are guaranteed by NextEra Energy Inc.

The bookrunners were BNY Mellon Capital Markets LLC, Citigroup, Credit Agricole CIB and Mizuho.

Proceeds will be used for general corporate purposes.

Franklin Financial on deck

In forward calendar news, Franklin Financial Network plans to sell fixed-to-floating-rate subordinated notes, according to a 424B3 filing with the SEC.

BofA Merrill Lynch is the bookrunner, and the lead manager is Raymond James.

Proceeds will be used to pay down a line of credit and for general corporate purposes.

The financial holding company is based in Franklin, Tenn.

Apple trades

Apple’s 4.65% bonds due 2046 headed out modestly lower at 107.25 from 107.89 on Thursday, according to a market source.

The bonds traded 4 bps tighter at the start of the session at 152 bps offered.

Apple sold $2.5 billion of the bonds (Aa1/AA+) on Feb. 16 at 99.423 to yield 4.686% and a spread of Treasuries plus 205 bps.

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

FedEx improves

FedEx’s 4.55% bonds due 2046 rose to 101.60 in secondary trading from where the bonds last traded at 101.24 on Thursday, according to a market source.

Earlier in the day, the bonds were quoted flat at 182 bps offered.

FedEx sold $1.25 billion of the bonds (Baa2/BBB) on March 21 at 99.561 to yield 4.577% and a spread of 185 bps over Treasuries.

The package and freight transportation company is based in Memphis.

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