Wal-Mart prices to strong demand; BioMed tightens, Wal-Mart firms in aftermarket

By Cristal Cody and Aleesia Forni

Virginia Beach, April 15 - Plains All American Pipeline, LP, Wal-Mart Stores Inc. and BioMed Realty LP sold bonds during the Passover holiday on Tuesday.

Wal-Mart Stores came to market with an upsized $2.5 billion issue of senior notes in three tranches.

The company sold $500 million of 1% notes due 2017 at Treasuries plus 17 basis points and $1 billion of 3.3% 10-year notes at 73 bps over Treasuries.

There was also a $1 billion tranche of 4.3% 30-year bonds priced with a spread of Treasuries plus 90 bps.

One market source noted "a lot of interest" for the Wal-Mart deal, with the three tranches pricing around 10 bps tighter than original guidance.

The deal's orderbook was nearly four times oversubscribed, he added.

Also on Tuesday, Landeskreditbank Baden-Wurttemberg-Forderbank (L-Bank) sold $1 billion of floating-rate notes due 2016 at par to yield Libor plus 5 bps.

Plains All American Pipeline priced an upsized $700 million issue of 4.7% 30-year bonds at 127 bps over Treasuries.

In other market action, BioMed Realty brought to market $400 million of 2.625% senior notes due May 1, 2019 with a spread of Treasuries plus 115 bps.

Market activity remains subdued with many potential issuers sidelined due to this week's earnings announcements.

A market source said the market could see a few deals price during the session on Wednesday, though most issuers are expected to hold off until after the holiday-shortened week.

Roughly $7.3 billion of investment-grade paper has priced as of Tuesday.

Investment-grade bonds were better at the start of the session but ended flat to slightly wider, while new issues traded stronger, sources said.

The day mostly "was quiet," a source said.

The Markit CDX North American Investment Grade series 22 index eased 1 bp to a spread of 69 bps.

Wal-Mart's three tranches of notes brought in the session traded about 4 bps better in the secondary market as the session closed, a trader said.

BioMed Realty's 2.625% notes due 2019 firmed 7 bps in aftermarket trading, according to a trader.

Wal-Mart prices tight

Wal-Mart Stores priced $2.5 billion of senior notes in tranches due 2017, 2024 and 2044, according to a market source and an FWP filed with the Securities and Exchange Commission.

The deal was upsized from $2 billion.

The sale included $500 million of 1% three-year notes priced with a spread of Treasuries plus 17 bps, or 99.985, to yield 1.005%.

A second tranche was $1 billion of 3.3% notes due 2024 sold at 73 bps over Treasuries.

Pricing was at 99.612 to yield 2.75%.

There was also $1 billion of 4.3% 30-year bonds, which priced at 99.349 to yield 4.339%, or Treasuries plus 90 bps.

All three tranches sold at the tight end of talk.

Wal-Mart Stores' 1% notes due 2017 tightened on the offered side to 12 bps, a trader said.

The 3.3% notes due 2024 firmed to 69 bps bid, 67 bps offered in secondary trading.

Wal-Mart's tranche of 4.3% bonds due 2044 tightened to 86 bps bid, 85 bps offered, the trader said.

The joint bookrunners were Citigroup Global Markets Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC, BBVA Securities Inc., Mitsubishi UFJ Securities (USA), Inc. and Mizuho Securities USA Inc.

Wal-Mart was last in the U.S. bond market on Sept. 25, 2013 with $1.75 billion of senior notes in two tranches.

The discount retailer is based in Bentonville, Ark.

Plains All American upsizes

Plains All American Pipeline, LP and PAA Finance Corp. sold $700 million of 4.7% senior notes (Baa2/BBB/) due 2044 on Tuesday with a spread of Treasuries plus 127 bps, according to a market source and an FWP filed with the SEC.

Pricing was at 99.734 to yield 4.716%.

Proceeds will be used to repay outstanding borrowings under the company's commercial paper program and for general partnership purposes.

Citigroup Global Markets, SunTrust Robinson Humphrey Inc., UBS Securities LLC, Mitsubishi UFJ Securities, Scotia Capital (USA) Inc. and Wells Fargo Securities LLC were the joint bookrunners.

The oil and natural gas transportation, production and storage company is based in Houston.

BioMed new issue

BioMed Realty priced $400 million of 2.625% senior notes (Baa3/BBB/) due May 1, 2019 at Treasuries plus 115 bps, according to an informed source and an FWP filed with the SEC.

Pricing was at 99.408 to yield 2.752%.

BioMed Realty's 2.625% notes due 2019 tightened in the secondary market to 108 bps bid, 105 bps offered, a trader said.

Wells Fargo Securities, Deutsche Bank Securities Inc., KeyBanc Capital Markets Inc. and U.S. Bancorp Investments Inc. were the bookrunners.

Proceeds will be used to repay a portion of the debt under an unsecured line of credit and for other general corporate purposes and working capital.

The notes are guaranteed by BioMed Realty Trust, Inc.

BioMed Realty is a San Diego-based REIT of lab and office space for the life science industry.

L-Bank priced floaters

Landeskreditbank Baden-Wurttemberg-Forderbank (L-Bank) priced $1 billion of two-year floating-rate notes at par to yield Libor plus 5 bps, according to an informed source.

Deutsche Bank Securities, JPMorgan, RBC Securities LLC and Commerzbank AG were the joint bookrunners.

The financial services provider is based in Karlsruhe, Germany.

Bank/brokerage CDS unchanged

Investment-grade bank and brokerage CDS prices were flat, according to a market source.

Bank of America Corp.'s CDS costs were unchanged at 66 bps bid, 69 bps offered. Citigroup Inc.'s CDS costs ended flat at 73 bps bid, 76 bps offered. JPMorgan Chase & Co.'s CDS costs closed unchanged at 57 bps bid, 60 bps offered. Wells Fargo & Co.'s CDS costs firmed 1 bp to 36 bps bid, 39 bps offered.

Merrill Lynch's CDS costs were flat at 70 bps bid, 73 bps offered. Morgan Stanley's CDS costs ended unchanged at 78 bps bid, 81 bps offered. Goldman Sachs Group, Inc.'s CDS costs closed flat at 91 bps bid, 94 bps offered.

Stephanie Rotondo contributed to this review.

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