Corning, ANZ, Level 3, Nationwide, Kansas City, Edison, Genpact price; inflows lower

By Cristal Cody

Tupelo, Miss., Nov. 14 – Investment-grade bond supply on Thursday remained heavy with new issuance from Corning Inc., ANZ Banking Group Ltd., New York Branch, Level 3 Financing Inc., Nationwide Financial Services Inc., Kansas City Southern, Edison International, Genpact Luxembourg Sarl and Principal Life Global Funding II.

Corning priced $1.5 billion of notes in two tranches.

ANZ New York Branch sold $1.5 billion of notes in two tranches.

Level 3 Financing priced $1.5 billion of split-rated senior secured notes in two parts.

Nationwide Financial Services priced $1 billion of 30-year notes following fixed income investor calls earlier in the week.

Kansas City Southern brought $850 million of guaranteed senior notes in two parts during the session.

Edison International sold $800 million of senior notes in two tranches.

Genpact Ltd. subsidiary Genpact Luxembourg sold $400 million of five-year guaranteed senior notes after holding fixed income investor calls on Tuesday.

In addition, Principal Life Global Funding II priced $400 million of five-year senior secured notes backed by funding agreements.

Meanwhile, several companies are in the process of holding fixed income investor calls with potential issuance to follow, according to market sources.

Western Union Corp. (Baa2/BBB/BBB+) is holding a U.S. roadshow and fixed income investor calls that end Friday, according to market sources.

Citigroup Global Markets Inc., J.P. Morgan Securities LLC and Wells Fargo Securities LLC are the arrangers.

The company last tapped the high-grade bond market in June 2018.

Also on Thursday, Equifax Inc. (Baa1/BBB+), last reported in the high-grade primary market in May 2018, held fixed income investor calls for a possible bond offering, a market source said.

BofA Securities, Inc., J.P. Morgan, Mizuho Securities USA Inc., SunTrust Robinson Humphrey Inc. and Wells Fargo are the arrangers.

Deal volume from the past three sessions totals about $48 billion, in line with the $45 billion to $50 billion of supply that was forecast for the holiday-shortened week, according to market sources.

In the secondary market, AbbVie Inc.’s $30 billion 10-tranche offering of bonds priced on Tuesday traded about 1 basis point to 10 bps better in trading, a source said.

The company’s $5.5 billion tranche of 3.2% notes due Nov. 21, 2029 improved about 4 bps, the source said.

The notes priced at a Treasuries plus 130 bps spread.

Corporate investment-grade funds inflows were down slightly on the week ended Wednesday at $2.27 billion from $2.29 billion in the prior week, according to Lipper US Fund Flows.

The Markit CDX North American Investment Grade 33 index ended the day slightly tighter at a spread of 52.4 basis points.

Corning raises $1.5 billion

Corning priced a $1.5 billion two-part offering of notes (Baa1/BBB+) on Thursday, according to an FWP filing with the Securities and Exchange Commission.

A $400 million tranche of 30-year notes priced at 99.72 to yield 3.916%, or a spread of Treasuries plus 160 bps.

Corning sold $1.1 billion of 5.45% 60-year bonds at a 315-bps spread over Treasuries. The bonds priced at 99.72 to yield 5.466%.

BofA Securities and Citigroup were the bookrunners.

The Corning, N.Y.-based issuer is a technology manufacturing company.

ANZ prices $1.5 billion

ANZ, New York Branch sold $1.5 billion of fixed-and floating-rate notes in two tranches on Thursday, according to a market source.

A $500 million tranche of three-year floating-rate notes priced at Libor plus 49 bps.

ANZ sold $1 billion of 2.05% three-year fixed-rate notes at a spread of 48 bps over Treasuries.

Bookrunners were ANZ Securities Inc., BofA Securities, Goldman Sachs & Co. LLC and Wells Fargo.

The New York-based corporate and investment banking company is a subsidiary of Australia & New Zealand Banking Group Ltd.

Level 3 sells secured notes

Level 3 Financing priced $1.5 billion of split-rated senior secured notes (Ba1/BBB-/BBB-) in two tranches on Thursday, according to a market source.

The company sold $750 million of 3.4% notes due March 1, 2027 at a spread of 170 bps over Treasuries, on the tight side of guidance in the 170-bps spread area.

A $750 million tranche of 3.875% notes due Nov. 15, 2029 priced with a Treasuries plus 205 bps spread.

Guidance was in the Treasuries plus 210 bps area.

BofA Securities and Citigroup were the bookrunners.

The notes are guaranteed by parent company Level 3 Parent, LLC and certain domestic subsidiaries.

Broomfield, Colo.-based Level 3 Financing, an indirect subsidiary of CenturyLink, Inc., provides telecommunications services.

Nationwide brings $1 billion

Nationwide Financial Services priced $1 billion of 3.9% 30-year notes in a Rule 144A and Regulation S offering on Thursday at a spread of 162 bps over Treasuries, according to a market source.

Initial price talk on the notes (A2/A) was in the Treasuries plus 180 bps to 185 bps area.

BofA Securities, J.P. Morgan and Wells Fargo were the lead managers.

The notes will be guaranteed by parent company Nationwide Mutual Insurance Co.

The company held fixed income investor calls for the deal on Tuesday and Wednesday.

The insurance provider is based in Columbus, Ohio.

Kansas City Southern prices

Kansas City Southern priced $850 million of guaranteed senior notes (Baa3/BBB-/BBB) in two tranches, according to FWP filings.

The company sold $425 million of 2.875% 10-year notes at 99.914 to yield 2.885%. The notes priced at a spread of 107 bps over Treasuries.

A $425 million tranche of 4.2% 50-year notes priced at 99.502 to yield 4.224%, or a Treasuries plus 192 bps spread.

Bookrunners were BofA Securities, J.P. Morgan and Morgan Stanley & Co. LLC.

The notes are guaranteed by certain of Kansas City Southern’s domestic subsidiaries.

The rail transportation holding company for Kansas City Southern Railway Co. is based in Kansas City, Mo.

Edison sells two tranches

Edison International sold $800 million of senior notes (Baa3/BBB-/BBB-) in two tranches on the tight side of guidance on Thursday, according to a market source.

A $300 million tranche of 3.125% notes due Nov. 15, 2022 priced at a spread of 155 bps over Treasuries.

The company sold $500 million of 3.55% notes due Nov. 15, 2024 with a Treasuries plus 195 bps spread.

Bookrunners were Barclays, Citigroup, SunTrust Robinson, Mizuho and SMBC Nikko Securities America Inc.

Rosemead, Calif.-based Edison International is the parent holding company of electric utility Southern California Edison Co.

Genpact prices notes

Genpact Luxembourg sold $400 million of 3.375% five-year guaranteed senior notes in a registered offering on Thursday at a spread of Treasuries plus 175 bps, according to an FWP filing.

The notes (Baa3/BBB-) priced at 99.976 to yield 3.38%.

Citigroup, Morgan Stanley, Wells Fargo, BofA Securities, Credit Agricole Securities (USA) Inc. and J.P. Morgan were the bookrunners.

The notes are guaranteed by Genpact Ltd.

Genpact Luxembourg is a Luxembourg-based global professional process services firm. The parent company is based in New York.

Principal Life II in primary

Principal Life Global Funding II priced $400 million of 2.25% five-year senior secured notes (A1/A+) backed by funding agreements at a spread of 65 bps over Treasuries on Thursday, according to a market source.

Initial price talk was in the Treasuries plus high 70 bps spread area.

The deal was upsized from $300 million.

Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and HSBC Securities (USA) Inc. were the bookrunners of the Rule 144A and Regulation S offering.

Principal Life Global Funding II is a debt issuer arm of Principal Financial Group, Inc., a Des Moines-based retirement savings, investment and insurance products company.

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