Lexington Realty upsizes; strong deal pace anticipated; Oglethorpe, Southern Co. Gas eyed

By Cristal Cody

Tupelo, Miss., Aug. 14 – High-grade supply continued on Friday with one issuer in the primary market, sources report.

Lexington Realty Trust priced $400 million of 10-year senior notes (Baa2/BBB-/BBB) to strong demand.

The deal was upsized from $300 million and priced at a spread of Treasuries plus 210 basis points, tighter than initial talk at the Treasuries plus 275 bps area and guidance of Treasuries plus 225 bps.

Lexington Realty Trust held fixed income investor calls for the offering on Thursday.

Investment-grade supply blew past market estimates this week to close out with more than $47 billion of issuance. About $25 billion to $30 billion of deal volume was expected for the week.

Additional supply is being eyed from other companies that held fixed income investor calls this week, including Oglethorpe Power Corp. and Southern Co. Gas.

Oglethorpe (Baa1//BBB+) continued a second scheduled day of investor calls on Friday for a possible deal.

Southern Co. subsidiary Southern Co. Gas (Baa1/A-/BBB+) also held fixed income investor calls on Thursday and Friday.

Looking ahead to next week, no letup in the deal pace is expected, syndicate sources report.

Market sources are anticipating about $30 billion to $40 billion of investment-grade volume.

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