Rhode Island DOT details $181.81 million bond sale; Johns Hopkins brings $400 million bonds

By Sheri Kasprzak

New York, March 19 - Thursday proved to be a stellar day for municipal bonds as the market improved dramatically in response to a Treasury rally.

The long end improved more dramatically, but traders said high-grade munis were better overall.

"It's been a great day," one trader enthused late Thursday afternoon. "High-grade bonds are rallying. The long end is way up, but we've seen improvements across the spectrum."

The positive move comes after a major market downturn, sparked in part by a huge influx of new issues hitting the market.

The recent glut of offerings made some issuers edgy about their deals. One issuer told Prospect News that the surge in new issues made it more difficult to get the desired pricing terms for his offering but noted he was pleased overall with the sale on Wednesday.

In primary news Thursday, the Rhode Island Economic Development Corp. released the details of its $181.805 million sale of grant anticipation and revenue bonds for the Rhode Island Department of Transportation.

The deal consisted of $169.395 million series 2009A grant anticipation bonds due from 2010 to 2021 and $12.41 million series 2009A motor fuel tax revenue bonds due from 2010 to 2027, said spokesman Jon Duff.

The corporation originally reported that $179.13 million had been sold.

Citigroup Global Markets Inc. acted as the lead underwriter for the negotiated deal.

The Rhode Island Economic Development is based in Providence, R.I.

Modesto Irrigation cultivates $130 million

The Modesto Irrigation District in California priced $130 million in series 2009A certificates of participation (A1/A+/A+), according to Don Dermond, a district spokesman.

The deal fetched a 5.9% yield.

J.P. Morgan Securities Inc. acted as the lead underwriter for the negotiated deal.

The COPs carry serial maturities from 2016 through 2029. Term bonds are due in 2034 and 2039.

Proceeds will be used to acquire and construct improvements to the district's electric system.

The Modesto Irrigation District is located in Modesto, Calif.

Blue Jays raise $400 million

Johns Hopkins University in Maryland priced $400 million 10-year bonds with a coupon of 5.25% at a spread of Treasuries plus 270 basis points (Aa2/AA/AA+), according to a market source.

JPMorgan and Morgan Stanley & Co. Inc. acted as underwriters for the deal.

Johns Hopkins University is located in Baltimore.

The bonds were later seen trading tighter at 262 bps bid, 256 bps offered.

Missouri utility prices $103.14 million

The Missouri Joint Municipal Electric Utility Commission priced $103.135 million power project revenue bonds at a true interest cost of 6.153192% on Wednesday (A3), according to Mike Loethen, commission chief financial officer.

"We were pleased with the deal given the day's market condition," he said on Thursday. "I was pleased with the participation."

Investors looked beyond the A3 rating, he said.

The bonds were split into two tranches.

The commission priced $99.975 million of the series 2009A bonds with serial bonds due from 2013 to 2019 and term bonds due in 2019, 2029 and 2039. The serial bonds carried yields from 3.5% to 4.5%, while the term bonds will yield 5.25%, 5.75% and 6%, respectively.

The commission also priced $3.106 million series 2009B bonds due in 2012.

JPMorgan acted as lead underwriter for the negotiated deals.

Proceeds will be used to finance a portion of the costs to acquire an interest in a coal-fired generating unit under construction near Weston, Mo.

The Missouri Joint Municipal Electric Utility Commission has headquarters in Columbia, Mo.

Ohio Water sale ahead

In upcoming sales, the Ohio Water Development Authority announced plans Thursday to sell $119.495 million in series 2009A fresh water revenue bonds.

The bonds (Aaa/AAA/) will be sold on a negotiated basis with Morgan Stanley as the senior manager, according to a preliminary official statement.

The bonds are due 2009 to 2016.

Proceeds will be used to refund the authority's series 1998 fresh water bonds.

Mississippi's G.O. refunding bonds

Also coming up, the state of Mississippi is expected to price $101.445 million in series 2009 G.O. refunding bonds, according to a preliminary official statement.

The sale includes $59.945 million in series 2009A bonds, $16.115 million in series 2009B bonds and $25.385 million in series 2009C bonds.

The bonds will be sold on a negotiated basis with Morgan Keegan & Co. Inc. and Morgan Stanley as the lead managers.

The 2009A bonds are due 2009 to 2018, the 2009B bonds are due 2009 to 2013 and the 2009C bonds are due 2009 to 2018.

Proceeds will be used to refund the state's series 1998, 2002B, 2003 and 2004 G.O. bonds.

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