Lloyds sells $4 billion notes; Celgene, GATX, Philip Morris, Constellation, Amgen price

By Cristal Cody

Tupelo, Miss., Oct. 31 – Lloyds Banking Group plc led pricing action in the investment-grade bond market on Tuesday with a $4 billion two-tranche offering of senior callable fixed-to-floating rate notes.

In other supply, Celgene Corp. priced a $3 billion three-tranche offering of senior notes.

Constellation Brands, Inc. came with $2 billion of senior notes in three tranches.

Amgen Inc. sold $1 billion of 10-year senior notes.

GATX Corp. placed $300 million of long 10-year senior notes.

Also, Nederlandse Waterschapsbank NV priced a $500 million tap of its 1.75% senior notes due Sept. 5, 2019.

Deal action was strong during the session with several offerings, including issuance expected from Philip Morris International Inc.

The Markit CDX North American Investment Grade 29 index tightened about 1 basis point to close at a spread of 52 bps.

Lloyds brings two tranches

Lloyds Banking Group priced a $4 billion two-tranche offering of senior callable fixed-to-floating rate notes (A3/BBB+/A+) on Tuesday, according to a market source and an FWP filing with the Securities and Exchange Commission.

The company sold $2.25 billion of 2.907% notes due 2023 at par to yield a spread of Treasuries plus 90 bps. The notes tightened from initial price talk in the Treasuries plus 110 bps area.

The fixed rate notes will convert to a floating rate of Libor plus 81 bps from Nov. 7, 2022 to but excluding Nov. 7, 2023.

Lloyds priced $1.75 billion of 3.574% notes due Nov. 7, 2028 at par to yield a Treasuries plus 120 bps spread, tighter than initial talk in the Treasuries plus 140 bps area. The notes will convert to a floating rate of Libor plus 120.5 bps from Nov. 7, 2027 to but excluding Nov. 7, 2028.

Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, Lloyds Securities Inc., Morgan Stanley & Co. LLC and Nomura Securities International, Inc. were the bookrunners.

Proceeds will be used for general corporate purposes.

Lloyds is a bank and financial services group based in London.

Celgene prices $3 billion

Celgene priced a $3 billion three-tranche offering of senior notes (Baa2/BBB+/) on Tuesday, according to a market source and an FWP filing with the SEC.

The company sold $750 million of 2.75% notes due Feb. 15, 2023 at 99.944 to yield 2.762% and a spread of Treasuries plus 75 bps.

Celgene placed $1 billion of 3.45% 10-year notes at 99.848 to yield 3.468%, or a Treasuries plus 110 bps spread.

The company priced $1.25 billion of 4.35% 30-year notes at 99.733 to yield 4.366%. The bonds priced with a spread of 150 bps over Treasuries.

The tranches priced on the tight side of guidance.

Barclays, Credit Suisse Securities (USA) LLC, Goldman Sachs, J.P. Morgan Securities and Morgan Stanley were the bookrunners.

Proceeds will be used to repay on or prior to maturity the company’s $1 billion of 2.125% senior notes and $400 million of its 2.3% senior notes, each maturing in August 2018, and for general corporate purposes.

The global biopharmaceutical company is based in Summit, N.J.

Constellation sells $2 billion

Constellation Brands priced $2 billion of fixed-rate senior notes (Baa3/BBB-/) in three tranches on Tuesday, according to a market source and a company news release.

The company sold $600 million of 2% two-year notes at 99.86 and a spread of Treasuries plus 48 bps.

Constellation Brands priced $700 million of 2.25% three-year notes at 99.804 and with a Treasuries plus 60 bps spread.

The $700 million tranche of 2.65% five-year notes priced at 99.582 and a spread of 73 bps over Treasuries.

The tranches were priced on the tight side of guidance.

BofA Merrill Lynch and J.P. Morgan Securities were the bookrunners.

The notes are guaranteed by subsidiaries of Constellation that are guarantors under the company’s senior credit facility.

Proceeds will be used to repay debt under the company’s European term A loan facility.

Constellation Brands is a Victor, N.Y.-based producer, importer and distributor of beer, wine and liquor.

Amgen raises $1 billion

Amgen sold $1 billion of 3.2% 10-year senior notes (Baa1/A/) on Tuesday at a spread of 87.5 bps over Treasuries, according to an FWP filing with the Securities and Exchange Commission.

The notes priced at 99.601 to yield 3.247%.

J.P. Morgan Securities, Morgan Stanley, BNP Paribas Securities Corp., RBC Capital Markets, LLC and UBS Securities LLC were the bookrunners.

Proceeds will be used for general corporate purposes.

Amgen is a Thousand Oaks, Calif., manufacturer and marketer of human therapeutics based upon advances in cellular and molecular biology.

GATX sells notes

GATX sold $300 million of 3.5% senior notes due March 15, 2028 (Baa2/BBB/) on Tuesday at 99.521 to yield 3.556%, according to an FWP filing with the SEC.

The notes priced with a spread of 118 bps over Treasuries.

Citigroup Global Markets Inc., Morgan Stanley and BofA Merrill Lynch were the bookrunners.

Proceeds will be used to repay $200 million of the company’s 6% senior notes due Feb. 15, 2018 and for general corporate purposes.

GATX is a transportation leasing company based in Chicago.

Nederlandse reopens

Nederlandse Waterschapsbank (Aaa/AAA/) priced a $500 million reopening of its 1.75% senior notes due Sept. 5, 2019 in a Rule 144A and Regulation S offering on Tuesday at a spread of Treasuries plus 21.3 bps, according to a market source.

BofA Merrill Lynch and Deutsche Bank Securities Inc. were the bookrunners.

The agency originally priced $500 million of the notes on Aug. 29, 2014 at 99.416 to yield 1.873%, or spread of mid-swaps plus 9 bps. The total outstanding now is $1 billion.

The local government funding agency is based in The Hague.

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