High-grade primary flooded with new deals; spreads weaken; new bonds tighten

By Cristal Cody and Aleesia Forni

Virginia Beach, Nov. 5 - The high-grade corporate bond market was flooded with new deals on Tuesday, as issuers rushed to take advantage of the positive tone and low borrowing costs.

The session saw Norway's Statoil ASA bring to market $4 billion of notes in five tranches.

Also on Tuesday, Perrigo Co. Ltd. sold $2.3 billion of senior notes in four tranches, according to a company release.

MidAmerican Energy Holdings Co. also announced a new $2 billion four-part sale of senior notes.

Meanwhile, Noble Energy Inc. priced $1 billion of 5.25% senior notes due Nov. 15, 2043 at 150 basis points over Treasuries.

International Finance Corp. also hit the market on Tuesday, selling $1 billion of 0.625% notes due 2016 at mid-swaps minus 4 bps.

In another new deal, HCP Inc. priced $800 million of 4.25% 10-year senior notes with a spread of Treasuries plus 165 bps.

KeyCorp came to market to sell $750 million of 2.3% senior notes on Tuesday at Treasuries plus 93 bps.

In other primary action, PSEG Power LLC sold $500 million of senior notes in two tranches.

The company priced $250 million of 2.45% five-year notes at Treasuries plus 110 bps and $250 million of 4.3% 10-year notes at 165 bps over Treasuries.

Liberty Mutual Group Inc. came to the primary to tap its existing 4.25% 10-year senior notes to add $400 million.

The session also saw Aspen Insurance Holdings Ltd. price $300 million of 4.65% notes at Treasuries plus 200 bps.

AB Svensk Exportkredit priced a $250 million tier 2 10-year bond, according to a company release.

New issues were also announced from Japan Bank for International Cooperation and Toronto-Dominion Bank.

Japan Bank plans to price an issue of guaranteed bonds, while Toronto-Dominion is set to sell an offering of floaters due 2015.

Investment-grade bond spreads widened on the day, while new issues traded flat to moderately better in the secondary market, according to informed sources.

The Markit CDX North American Investment Grade series 21 index eased 1 bp to a spread of 74 bps.

Noble Energy's 5.25% notes firmed 3 bps in secondary trading.

Aspen Insurance's 4.65% senior notes traded 4 bps better.

PSEG Power's two tranches traded about 1 bp to 2 bps tighter.

MidAmerican Energy's four-part offering headed out in aftermarket trading flat to about 2 bps better.

The multi-tranche deals from Perrigo and Statoil also were active in secondary trading.

Perrigo sells $2.3 billion

Perrigo sold $2.3 billion of senior notes in four tranches on Tuesday, according to a company release.

The company priced $500 million of 1.3% notes due 2016 and $600 million of 2.3% notes due 2018.

An $800 million tranche of 4% notes due 2023 was sold, as well as $400 million of 5.3% bonds due 2043.

Full details were not available at press time.

In aftermarket trading, Perrigo's 1.3% notes traded at 75 bps bid, according to a trader.

The tranche of 2.3% notes traded at 93 bps bid, 90 bps offered.

The 4% notes traded at 138 bps bid, 132 bps offered.

The 5.3% bonds were seen at 152 bps offered.

Proceeds will be used to fund the company's acquisition of Elan Corp.

The sale was done under Rule 144A and Regulation S.

The health care company and maker of generic and over-the-counter pharmaceuticals is based in Allegan, Mich.

MidAmerican prices $2 billion

MidAmerican Energy Holdings priced $2 billion of new paper in a four-tranche sale on Tuesday, according to an informed source.

There was a tranche of 1.1% notes due 2016 priced with a spread of Treasuries plus 55 bps and a tranche of 2% notes due 2018 sold with a spread of Treasuries plus 65 bps.

A tranche of 3.75% notes due 2023 was sold at Treasuries plus 110 bps.

Finally, a tranche of 5.15% 30-year bonds priced at Treasuries plus 140 bps.

In the secondary market, MidAmerican Energy's 1.1% notes firmed to 53 bps bid, a trader said.

The 2% notes traded flat at 65 bps bid, 60 bps offered.

The tranche of 3.75% notes headed out at 108 bps offered.

The 5.15% bonds firmed to 138 bps offered.

J.P. Morgan Securities LLC, RBS Securities Inc., Barclays and Citigroup Global Markets Inc. were the joint bookrunners.

Proceeds will be used to fund part of the company's acquisition of NV Energy.

The utility is based in Des Moines.

Noble sells $1 billion

The session also saw Noble Energy price $1 billion of 5.25% senior notes due Nov. 15, 2043 at 150 bps over Treasuries, according to a syndicate source and an FWP filed with the Securities and Exchange Commission.

The notes (Baa2/BBB/) priced at 99.43 to yield 5.288%.

Noble Energy's 5.25% notes traded better at 152 bps bid, 149 bps offered going out on Tuesday, a trader said.

Citigroup Global Markets, Mitsubishi UFJ Securities, BofA Merrill Lynch, JPMorgan, DNB Markets and Mizuho Securities USA Inc. were the joint bookrunners.

The company intends to use about $900 million of the net proceeds from the offering to repay debt under its revolving credit facility and the balance of the net proceeds for general corporate purposes.

The crude oil and natural gas exploration and production company is based in Houston.

IFC brings three-year notes

In another new sale, International Finance priced $1 billion of 0.625% notes due 2016 with a spread of mid-swaps minus 4 bps, according to an informed source.

BofA Merrill Lynch, Citigroup Global Markets, Credit Agricole CIB and Skandinaviska Enskilda Banken were the banks on the deal.

The World Bank member and lender to the private sector in developing countries is based in Washington, D.C.

HCP sells 10-year notes

HCP also hit Tuesday's primary with an $800 million issue of 4.25% 10-year senior notes with a spread of Treasuries plus 165 bps, according to an FWP filed with the SEC.

Pricing was at 99.54 to yield 4.307%.

Citigroup Global Markets, Credit Suisse Securities (USA) LLC, RBS Securities, Credit Agricole and RBC Capital Markets were the joint bookrunners.

Proceeds will be used to repay the company's $400 million of 5.65% senior notes due Dec. 15, 2013, with any additional proceeds to repay amounts outstanding under the company's bank line of credit and for general corporate purposes.

The real estate investment trust for the health-care industry is based in Long Beach, Calif.

KeyCorp prices $750 million

KeyCorp priced $750 million of 2.3% senior notes with a spread of Treasuries plus 93 bps, or 99.937, to yield 2.313%, according to an FWP filed with the SEC.

The notes (Baa1/BBB+/A-) will mature on Dec. 13, 2018.

KeyBanc Capital Markets, Credit Suisse Securities (USA), Goldman Sachs & Co., JPMorgan and Morgan Stanley & Co. LLC were the joint bookrunners.

Proceeds will be used for general corporate purposes.

The financial services company is based in Cleveland.

PSEG sells two-parter

PSEG Power brought to market a $500 million sale of senior notes in two tranches, according to a market source and two separate FWP filings with the SEC.

The deal included $250 million of 2.45% senior notes due 2018 priced at Treasuries plus 110 bps, or 99.85, to yield 2.482%.

A second tranche was $250 million of 4.3% 10-year notes priced at 165 bps over Treasuries.

The notes sold at 99.943 to yield 4.307%.

PSEG Power's 2.45% notes firmed to 108 bps bid, 104 bps offered, according to a trader.

The 4.3% notes traded at 164 bps bid, 161 bps offered.

Barclays, BNP Paribas Securities Corp., Goldman Sachs, Mizuho Securities USA and Wells Fargo Securities LLC were the joint bookrunners.

Credit Agricole Securities (USA), TD Securities (USA) LLC and Drexel Hamilton LLC were the co-managers.

PSEG Fossil LLC, PSEG Nuclear LLC and PSEG Energy Resources & Trade LLC will guarantee the notes.

The energy supply company is based in Newark, N.J.

Liberty adds on

Liberty Mutual Group tapped its existing issue of 4.25% senior notes (Baa2/BBB-/) due 2023 to add $400 million in Tuesday's session, according to a company press release.

The sale was done under Rule 144A and Regulation S.

The original $600 million issue priced at Treasuries plus 215 bps on June 13.

Liberty Mutual is a Boston-based property and casualty insurance company.

Aspen sells $300 million

Bermuda-based Aspen Insurance Holdings sold $300 million of 4.65% senior notes (Baa2/BBB+/) on Tuesday with a spread of Treasuries plus 200 bps, according to an informed source and an FWP filed with the SEC.

Pricing was at 99.889 to yield 4.664%.

Aspen Insurance's 4.65% senior notes tightened to 196 bps bid, 193 bps offered in late afternoon trading, a trader said.

Barclays, Citigroup Global Markets, Deutsche Bank Securities Inc. and HSBC Securities (USA) Inc. were the joint bookrunners.

Proceeds will be used to pay the redemption price on the company's 6% senior notes due Aug. 15, 2014. Any remaining net proceeds may be used for general corporate purposes.

Aspen Insurance is a holding company for insurance and reinsurance subsidiaries.

SEK prices tier 2 bond

Svensk Exportkredit was also in the market on Tuesday, pricing a $250 million tier 2 10-year bond, according to a company release.

The bond will be non-callable for five years.

BofA Merrill Lynch, Goldman Sachs, HSBC and Nomura carried out the transaction.

Asset managers accounted for 67% of the investors, 17% were insurance companies and pension funds, 12% were banks, and private banks accounted for 4%.

By region, Europeans accounted for 46% of investors, 31% were U.S. investors, 14% were Nordics, 5% of investors were from the Middle East, and Asian investors accounted for 4%.

Based in Stockholm, Svensk is the lender to Sweden's export industry.

Statoil launches

Statoil ASA launched a $4 billion sale of notes (Aa2/AA-/) in five tranches on Tuesday, according to an informed source.

The sale included five-year notes launched at Treasuries plus 60 bps and five-year floaters launched at Libor plus 46 bps.

A seven-year tranche of notes was launched at 85 bps over Treasuries.

There was also a 10-year tranche and 30-year tranche both launched at Treasuries plus 105 bps.

Bookrunners are BofA Merrill Lynch, Credit Suisse Securities (USA), Deutsche Bank Securities and Morgan Stanley.

Proceeds will be used for general corporate purposes, which may include the repayment of debt, working capital or the financing of acquisitions.

The notes are guaranteed by Statoil Petroleum AS.

The oil and gas production company is based in Stavanger, Norway.

JBIC eyes bonds

Japan Bank for International Cooperation is set to price guaranteed bonds (Aa3/AA-/), according to a 424B5 filing with the SEC.

The securities will be guaranteed by Japan.

BofA Merrill Lynch, BNP Paribas Securities, Citigroup Global Markets, and JPMorgan are the joint bookrunners.

Proceeds will be used for the operation of the bank.

Japan Bank was last in the U.S. bond market with a $3.5 billion offering of notes in two tranches on July 23.

TD Bank plans floaters

In another new announcement, Toronto-Dominion Bank is planning to price an offering of floating-rate senior medium-term notes, series A, due 2015, according to a supplement filed with the SEC on Tuesday.

TD Securities and Wells Fargo Securities are the joint bookrunners.

Proceeds will be added to the company's general funds and used for general corporate purposes.

The financial services and banking company is based in Toronto.

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