Morning Commentary: Allergan tightens; Wells Fargo paper improves; credit spreads ease

By Cristal Cody

Tupelo, Miss., Nov. 24 – Allergan plc’s bonds (/BBB-//BBB-) were trading about 10 basis points to 20 bps tighter early Tuesday in the secondary market following Monday’s announcement that Pfizer Inc. plans to acquire the Dublin drugmaker in a record deal valued at $160 billion.

Allergan’s 3.8% notes due 2025 traded nearly 20 bps tighter at 145 bps bid, a market source said.

Pfizer’s bonds were quoted mostly flat late Monday afternoon.

In other secondary trading, Wells Fargo & Co.’s 3.55% senior holding company notes due 2025 firmed 3 bps.

The Markit CDX North American Investment Grade 25 index opened the session 1 bp wider at a spread of 86 bps.

Wells Fargo firms

Wells Fargo’s 3.55% notes due 2025 traded 3 bps tighter at 118 bps offered, according to a market source.

Wells Fargo sold $2.55 billion of the notes (A2/A+/AA-) on Sept. 21 at a spread of 137.5 bps over Treasuries.

The bank is based in San Francisco.

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