Amazon issues $6 billion; DirecTV, Morgan Stanley also price; DirecTV tightens; Amazon better

By Aleesia Forni and Cristal Cody

Virginia Beach, Dec. 2 – Amazon.com Inc., DirecTV Holdings LLC, American Express Co. and Morgan Stanley & Co. Inc. were among the issuers pricing more than $12.4 of investment-grade bonds on Tuesday.

Amazon.com faced some pushback from investors with its new $6 billion trade, with the new issue spreads on its five-part deal unmoved from initial price thoughts.

The orderbook for the offering was around two times oversubscribed.

The deal follows yesterday’s megadeal from Medtronic Inc., which sold $17 billion of debt in seven tranches.

In other primary happenings, DirecTV issued $1.2 billion of 10-year notes around 20 basis points tight of price guidance on Tuesday.

American Express was also in the market with a $600 million issue of subordinated notes, while Morgan Stanley offered $2.25 billion of notes in two tranches.

Plains All American Pipeline, LP and PAA Finance Corp. sold $1.15 billion of senior notes in five- and 30-year tranches.

There was also a $1.25 billion sale of senior notes priced by National Australia Bank during the session on Tuesday.

The first week of December has already seen $33.8 billion of new issuance in just two sessions, already more than halfway toward what was expected to be around a $60 billion month.

Investment-grade bond spreads improved modestly over the session, while new issues traded mostly better, according to market sources.

The Markit CDX North American Investment Grade series 23 index firmed 1 bp to a spread of 62 bps.

DirecTV’s 3.95% notes due 2024 tightened nearly 10 bps in aftermarket trading, according to a trader.

Amazon’s short-dated tranches were not active in late afternoon aftermarket trading, while the company’s longer-dated notes traded about 1 bp better, a trader said.

Plains All American’s new long bonds tightened 3 bps on the offered side, according to a trader.

Morgan Stanley’s 1.875% notes due 2018 improved in the secondary market, along with American Express’ 3.625% subordinated notes due 2024, a trader said.

Amazon sells $6 billion

Amazon.com sold $6 billion of senior notes (Baa1/AA-/) in five maturities during the session on Tuesday, according to an informed source.

The company priced $1 billion of 2.6% five-year notes at 105 bps over Treasuries.

Pricing was at 99.8 to yield 2.643%.

A second tranche was $1 billion of 3.3% seven-year notes priced at 99.628 to yield 3.36, or 135 bps over Treasuries.

There was also $1.25 billion of 3.8% 10-year notes sold at 99.638 to yield 3.844%, or Treasuries plus 155 bps.

A $1.25 billion tranche of 4.8% 20-year bonds sold at 185 bps over Treasuries.

Pricing was at 99.175 to yield 4.865%.

Finally, $1.5 billion of 4.95% 30-year bonds sold at 99.236 to yield 5.065%, or Treasuries plus 205 bps.

All tranches sold in line with price talk, which was unchanged from initial guidance.

Bookrunners were Morgan Stanley & Co. LLC, BofA Merrill Lynch, Deutsche Bank Securities Inc. and HSBC Securities (USA) Inc.

Proceeds will be used for general corporate purposes.

Amazon’s tranches of notes due 2019 and 2021 were not active in late afternoon secondary trading, according to a trader.

The company’s offering of notes due 2024 traded modestly better at 153 bps offered as the session closed.

Amazon’s notes due 2034 firmed to 184 bps bid, 180 bps offered in aftermarket trading.

The tranche of notes due 2044 headed out at 204 bps bid, 201 bps offered, the trader said.

The online retailer is based in Seattle.

Morgan Stanley two-parter

Also on Tuesday, Morgan Stanley sold a $2.25 billion offering of three-year senior notes in fixed- and floating-rate tranches (Baa2/A-/A), according to a market source and an FWP filed with the Securities and Exchange Commission.

The sale included $500 million of floating-rate notes due Jan. 5, 2018 sold at par to yield Libor plus 74 bps.

Morgan Stanley also sold $1.75 billion of 1.875% notes due Jan. 5, 2018 at 99.892 to yield 1.911%, or Treasuries plus 98 bps.

Pricing was tighter than guidance that was set in the Treasuries plus 105 bps area.

Morgan Stanley is the bookrunner.

Morgan Stanley’s 1.875% notes due 2018 tightened to 95 bps bid, 92 bps offered in the secondary market, a trader said.

The financial services company is based in New York City.

NAB prices tight

National Australia Bank priced a $1.25 billion issue of senior notes (Aa2/AA-/AA-) in three tranches on Tuesday, a market source said.

The bank priced $400 million of two-year floaters at par to yield Libor plus 25 bps.

A $250 million tranche of five-year floating-rate notes sold at par to yield Libor plus 69 bps.

There was also a $600 million tranche of 2.4% five-year notes priced at 99.93 to yield 2.415%, or 83 bps over Treasuries.

The notes sold at the tight end of talk.

The deal was done via Rule 144A and Regulation S.

The bookrunners were Barclays, Citigroup Global Markets Inc., J.P. Morgan Securities LLC and National Australia Bank.

Melbourne, Australia-based National Australia Bank is the nation’s largest lender.

DirecTV brings 10-years

In other primary happenings on Tuesday, DirecTV Holdings and DirecTV Financing Co. priced $1.2 billion of 3.95% 10-year senior notes (Baa2/BBB/BBB-) at 175 bps over Treasuries, according to a market source and an FWP filing with the SEC.

Pricing was at 99.313 to yield 4.033%.

The notes sold tighter than guidance, which was in the Treasuries plus 195 bps area.

Barclays, JPMorgan, Morgan Stanley, Santander, Deutsche Bank Securities and RBC Capital Markets LLC were the bookrunners.

Proceeds will be used to repurchase, redeem, repay at maturity or otherwise retire the company’s 3.55% senior notes due March 15, 2015.

The notes are guaranteed by DirecTV and domestic subsidiaries of DirecTV Holdings LLC.

DirecTV’s 3.95% notes due 2025 tightened to 166 bps bid, 163 bps offered in the secondary market, a trader said.

The digital entertainment company is based in El Segundo, Calif.

Plains All American new issue

Plains All American Pipeline and PAA Finance Corp. priced $1.15 billion of senior notes (Baa2/BBB+/) in two tranches, according to a market source.

The sale included a $500 million tranche of 2.6% five-year notes priced at 99.813 to yield 2.64%, or 105 bps over Treasuries.

A second tranche was $650 million of 4.9% 30-year bonds sold with a spread of 190 bps over Treasuries.

Pricing was at 99.876 to yield 4.907%.

The notes sold at the tight end of price talk.

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

Barclays, SunTrust Robinson Humphrey Inc. and Wells Fargo Securities LLC were the joint bookrunners.

Plains All American’s notes due 2019 were not seen in aftermarket trading, according to a trader. The company’s tranche of notes due 2044 were quoted late afternoon at 187 bps offered.

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

AmEx prices tight

Meanwhile, American Express priced $600 million of 3.625% 10-year subordinated notes on Tuesday with a spread of Treasuries plus 140 bps, according to an informed source and an FWP filing with the SEC.

The notes (Baa1/BBB/A) sold at 99.527 to yield 3.682%.

Pricing was tighter than guidance.

Goldman Sachs & Co., Barclays and RBC Capital Markets LLC were the bookrunners.

Proceeds will be used for general corporate purposes.

American Express’ 3.625% subordinated notes due 2024 firmed to 137 bps bid, 132 bps offered in secondary trading, according to a trader.

The charge and credit card and travel services company is based in New York City.

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