By Cristal Cody
Eureka Springs, Ark., Sept. 13 – Altria Group Inc. sold $2 billion of guaranteed senior notes (A3/A-/BBB+) in two tranches on Tuesday, according to a market source.
The company priced $500 million of 2.625% 10-year notes at Treasuries plus 95 basis points.
Altria sold $1.5 billion of 3.875% 30-year notes at a spread of 150 bps over Treasuries.
Both tranches priced on the tight side of guidance.
Deutsche Bank Securities Inc., Goldman Sachs & Co., Mizuho Securities USA Inc. and Morgan Stanley & Co. LLC were the lead bookrunners.
The notes will have a make-whole call and then are callable at par, according to a 424B5 filing with the Securities and Exchange Commission.
Proceeds from the deal will be used to repurchase the company’s 9.95% notes due 2038 and outstanding 10.2% notes due 2039 and for general corporate purposes.
The securities are guaranteed by Richmond, Va.-based parent Philip Morris USA Inc., a cigarette and smokeless tobacco product maker.
| Issuer: | Altria Group Inc.
|
| Guarantor: | Philip Morris USA Inc.
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| Amount: | $2 billion
|
| Description: | Senior notes
|
| Bookrunners: | Deutsche Bank Securities Inc., Goldman Sachs & Co., Mizuho Securities USA Inc., Morgan Stanley & Co. LLC
|
| Trade date: | Sept. 13
|
| Ratings: | Moody’s: A3
|
| S&P: A-
|
| Fitch: BBB+
|
| Distribution: | SEC registered
|
|
|
| 10-year notes
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| Amount: | $500 million
|
| Maturity: | Sept. 16, 2026
|
| Coupon: | 2.625%
|
| Spread: | Treasuries plus 95 bps
|
| Price guidance: | Treasuries plus 100 bps area, plus or minus 5 bps
|
|
|
| 30-year notes
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| Amount: | $1.5 billion
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| Maturity: | Sept. 16, 2046
|
| Coupon: | 3.875%
|
| Spread: | Treasuries plus 150 bps
|
| Price guidance: | Treasuries plus 155 bps area, plus or minus 5 bps
|
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