GM Financial, Xylem, PepsiCo tap high-grade market; credit spreads stable; Viacom mostly flat

By Cristal Cody

Eureka Springs, Ark., Oct. 3 – General Motors Financial Co., Inc. and Xylem Inc. tapped the primary market on Monday.

General Motors Financial brought $1.75 billion of senior notes in three tranches.

Xylem raised $900 million in a two-part offering of senior notes.

PepsiCo, Inc. also priced a new deal. Final details were not available by press time.

The Markit CDX North American Investment Grade index ended the session mostly unchanged at a spread of 75 basis points.

In the secondary market, Viacom Inc.’s new 3.45% senior notes due 2026 were quoted mostly flat earlier in the day.

GM prices $1.75 billion

General Motors Financial (Ba1/BBB-/BBB-) priced $1.75 billion of senior notes in three parts on Monday, according to an FWP filing with the Securities and Exchange Commission.

The $250 million tranche of floating-rate notes due Oct. 4, 2019 priced at par to yield Libor plus 127 bps.

The company sold $750 million of 2.35% three-year notes at 99.971 to yield 2.36% and a spread of Treasuries plus 145 bps.

General Motors Financial priced $750 million of 4% 10-year notes at 99.861 to yield 4.017%, or Treasuries plus 240 bps.

The notes are guaranteed by operating subsidiary AmeriCredit Financial Services, Inc.

BNP Paribas Securities Corp., Citigroup Global Markets Inc., Lloyds Securities Inc., BofA Merrill Lynch and Mizuho Securities USA Inc. were the bookrunners.

Proceeds will be added to the company’s general funds and will be available for general corporate purposes.

General Motors Financial is the Fort Worth-based finance subsidiary of General Motors Co.

Xylem sells 10-, 30-year notes

Xylem priced $900 million of senior notes (Baa2/BBB/) in two tranches on Monday, according to an FWP filing with the SEC.

The company sold $500 million of 3.25% 10-year notes at 99.794 to yield 3.274% and a spread of 165 bps over Treasuries.

Xylem priced $400 million of 4.375% 30-year notes at 99.957 to yield 4.438%, or Treasuries plus 210 bps.

Citigroup, Wells Fargo Securities LLC and J.P. Morgan Securities LLC were the bookrunners.

Proceeds will be used, along with cash on hand, proceeds from commercial paper and borrowings under a new euro-denominated term loan, for the company’s planned acquisition of all of the subsidiaries of Sensus Worldwide Ltd. for about $1.7 billion in cash. The company will use any remaining proceeds for general corporate purposes.

The water technology company is based in White Plains, N.Y.

Viacom mostly unchanged

Viacom’s 3.45% notes due 2026 traded flat to about 1 bp softer at 187 bps offered earlier in the secondary market, a source said.

The notes (Baa3/BBB-/BBB) were seen on Friday at 189 bps bid, 186 bps offered.

The company priced $900 million of the notes on Thursday at a spread of Treasuries plus 195 bps.

Viacom is a New York City-based diversified media company with interests focused in cinema and cable television.

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