Public Service Enterprise, Principal Financial price; AT&T, Time Warner flat; Danone eases

By Cristal Cody

Eureka Springs, Ark., Nov. 3 – High-grade primary action is beginning to slow ahead of the U.S. presidential election with about $1.35 billion of corporate bond trading volume seen on Thursday.

Public Service Enterprise Group Inc. priced a $700 million two-part offering of senior notes.

Principal Financial Group, Inc. sold $650 million of senior notes in two tranches.

Investment-grade bonds were mostly unchanged in the secondary market over the session.

Bonds from AT&T Inc. and Time Warner Inc. were flat on the day. The companies’ bonds remain wider from mid-October levels before AT&T announced an $85.4 billion cash and stock offer to buy Time Warner.

Danone SA’s 2.947% notes due 2026 that priced in the previous week were quoted about 2 basis points weaker earlier in the day.

The Markit CDX North American Investment Grade index closed on Thursday unchanged at a spread of 80 bps.

Public Service sells notes

Public Service Enterprise Group sold $700 million of senior notes (Baa2/BBB) in two tranches on Thursday, according to a market source and an FWP filing with the Securities and Exchange Commission.

The company placed $400 million of 1.6% three-year notes at 99.883 to yield 1.64%, or 68 bps over Treasuries.

The $300 million tranche of 2% five-year notes priced at 99.81 to yield 2.04%, or Treasuries plus 78 bps.

The three- and five-year notes priced on the tight side of talk.

Barclays, J.P. Morgan Securities LLC, RBC Capital Markets, LLC, Scotia Capital (USA) Inc. and Wells Fargo Securities LLC were the bookrunners.

Proceeds will be used for general corporate purposes, including repayment of all or a portion of the company’s commercial paper program debt.

The diversified electric utility company is based in Newark, N.J.

Principal prices $650 million

Principal Financial Group sold $650 million of senior notes (Baa1/BBB+) in two tranches on Thursday, according to a market source and an FWP filing with the SEC.

The company priced $350 million of 3.1% 10-year notes at 99.854 to yield 3.117%. The notes priced with a spread of 130 bps over Treasuries.

Principal Financial Group sold $300 million of 4.3% 30-year notes at 99.882 to yield 4.307% and a spread of 170 bps over Treasuries.

Both tranches priced on the tight side of guidance.

Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc., HSBC Securities (USA) Inc., Barclays, Goldman Sachs & Co., BofA Merrill Lynch, U.S. Bancorp Investments Inc. and Wells Fargo were the bookrunners.

The notes are guaranteed by Principal Financial Services, Inc.

Proceeds will be used with available cash to purchase any 1.85% notes and 8.875% notes tendered in a tender offer and to redeem any 1.85% notes and 8.875% notes that are not tendered.

The retirement savings, investment and insurance products company is based in Des Moines.

AT&T stable

AT&T’s 4.125% notes due 2026 were flat on the day at 175 bps bid, according to a market source.

The notes were quoted on Oct. 21 trading at 146 bps bid.

The company priced a $900 million reopening of the bonds on May 3 at Treasuries plus 150 bps.

The notes originally were sold on Jan. 29, 2016 in a $1.5 billion offering at 195 bps over Treasuries.

AT&T is a Dallas-based telecommunications company.

Time Warner flat

Time Warner’s 2.95% notes due 2026 were mostly unchanged at 137 bps bid, a market source said.

The 10-year notes have widened from the 112 bps bid area before the merger with AT&T was announced.

The company sold $800 million of the notes on May 5, 2016 at a spread of 135 bps over Treasuries.

Time Warner is a New York-based media and entertainment company.

Danone eases

Danone’s 2.947% notes due 2026 traded about 2 bps weaker from the previous session at 116 bps offered earlier on Thursday, according to a market source.

The company sold $2 billion of the notes (Baa1/BBB+) on Oct. 26 at a spread of 115 bps over Treasuries.

Danone is a food products company based in Paris.

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