BP, Philip Morris bring deals; Apple edges tighter; JPMorgan firms; credit spreads soften

By Cristal Cody

Eureka Springs, Ark., April 28 – Two high-grade corporate bond issuers tapped the market on Thursday.

BP Capital Markets plc priced a $2 billion two-part offering of notes.

Philip Morris International Inc. sold $1 billion of senior notes in two tranches.

Investment-grade bonds were mixed in the secondary market, while credit spreads softened.

Apple Inc.’s 3.25% notes due 2026 gained 1 basis point over Thursday’s session after widening 7 bps in the previous day.

JPMorgan Chase & Co.’s 3.3% notes due 2026 firmed 2 bps.

Crown Castle International Corp.’s 3.7% senior notes due 2026 priced on Tuesday traded about 3 bps tighter than issuance earlier in the day.

Citigroup Inc.’s new 3.4% notes due 2026 were seen 1 bp softer than where the paper priced.

The Markit CDX North American Investment Grade series 23 index closed more than 2 bps weaker on Thursday at a spread of 76 bps.

BP Capital prices $2 billion

BP Capital Markets priced $2 billion of notes (A2/A-) in two tranches on Thursday, according to a market source.

The company sold $750 million of 1.676% three-year notes at Treasuries plus 75 bps, on the tight side of guidance of 80 bps, plus or minus 5 bps, over Treasuries.

The $1.25 billion tranche of 3.119% 10-year notes priced at a spread of 130 bps over Treasuries. The notes were talked to price at Treasuries plus 135 bps, plus or minus 5 bps.

Citigroup Global Markets Inc., Deutsche Bank Securities Inc., HSBC Securities (USA) Inc., J.P. Morgan Securities LLC, Mizuho Securities Co. and MUFG were the bookrunners.

BP Capital Markets is a financing arm of London-based oil and gas company BP plc.

Philip Morris taps market

Philip Morris International sold $1 billion of senior notes (A2/A) in two tranches on Thursday, according to a market source.

The company priced $500 million of 2.125% seven-year notes at a spread of 68 bps over Treasuries, compared to guidance of Treasuries plus 70 bps, plus or minus 2 bps.

In the second tranche, the company priced $500 million in a reopening of its 4.25% bonds due Nov. 10, 2044 at 118 bps over Treasuries. The bonds were guided at 120 bps, plus or minus 2 bps, over Treasuries.

The company originally sold $750 million of the bonds on Nov. 3, 2014 at a spread of Treasuries plus 135 bps. The total outstanding is $1.25 billion.

Citigroup, JPMorgan, HSBC Securities, Barclays, Santander Investment Securities Inc. and Societe Generale CIB were the bookrunners.

Proceeds will be added to the company’s general funds, which may be used for general corporate purposes, to refinance debt, to meet working capital requirements or to repurchase common stock, according to a 424B2 filing with the Securities and Exchange Commission

The producer of cigarette and tobacco products is based in New York City.

Apple modestly better

Apple’s 3.25% notes due 2026 firmed 1 bp to 93 bps bid in late afternoon secondary trading, according to a market source.

The company priced a $1.25 billion add-on to the issue on March 17 at a spread of Treasuries plus 100 bps.

Apple originally sold $2 billion of the notes on Feb. 16 at 150 bps over Treasuries.

The computer and mobile communications device company is based in Cupertino, Calif.

JPMorgan tightens

JPMorgan’s 3.3% notes due 2026 firmed 2 bps to 135 bps bid, according to a market source.

JPMorgan sold $2.5 billion of the notes (A3/A-) on March 18 at a spread of 145 bps over Treasuries.

The financial services company is based in New York City.

Crown Castle improves

Crown Castle International’s 3.7% senior notes due 2026 were seen about 3 bps tighter early Thursday, a market source said.

Crown Castle sold $750 million of the 10-year notes (Baa3/BBB-) on Tuesday at a spread of 180 bps over Treasuries.

Houston-based Crown Castle provides infrastructures for wireless carriers.

Citigroup eases

Citigroup’s 3.4% notes due 2026 traded 1 bp softer at 151 bps offered earlier in the day, according to a market source.

Citigroup sold $2 billion of the 10-year notes (Baa1/BBB+/A) on Tuesday at a spread of Treasuries plus 150 bps.

Citigroup is a New York-based financial services company.

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