Procter & Gamble, Tractor Supply, Acuity, Genuine Parts, Berkshire, Kommuninvest in primary

By Cristal Cody

Tupelo, Miss., Oct. 27 – Investment-grade supply revved up on Tuesday with several issuers in the primary market following thin volume on Monday.

Procter & Gamble Co. sold $2.25 billion of senior notes (Aa3/AA-/) in two tranches, including five- and 10-year notes.

Tractor Supply Co. priced $650 million of 10-year notes (Baa1/BBB) in an offering upsized from $500 million.

Acuity Brands Lighting, Inc. also priced an upsized $500 million of 10-year guaranteed notes (Baa1/BBB/) on Tuesday.

The deal was increased from $400 million.

Genuine Parts Co. tapped the primary market with $500 million of 10-year notes on Tuesday.

Banc of California, Inc. sold $85 million of 10-year fixed-to-floating-rate subordinated notes (Kroll: BBB-) over the day.

In addition, Bank of America Corp. offered $25-par series NN perpetual non-cumulative preferred stock (Baa3/BBB-/BBB) with initial price talk in the 4.625% area.

Also, Berkshire Hathaway Inc. offered three tranches of senior notes (A3/A-/BBB+) that includes notes due May 15, 2025 that are talked to price with a spread in the Treasuries plus 65 basis points area, notes due May 15, 2031 guided at the 115 bps spread area and notes due May 15, 2051 talked to price in the 150 bps over Treasuries area.

Kommuninvest prices tight

In sovereign, supranational and agency activity, Kommuninvest I Sverige AB (Aaa/AAA/) priced $1.25 billion of notes due July 20, 2022 on Tuesday at mid-swaps plus 2 bps.

Guidance was tightened to mid-swaps plus 3 bps from initial price talk in the mid-swaps plus 5 bps area.

The deal “priced at the tightest MS spread for a Nordic agency all year, as well as a tighter U.S. Treasury spread to the Kingdom of Sweden’s [two-year dollar-denominated] benchmark a few weeks prior,” Kommuninvest said in a news release.

The deal is Kommuninvest’s fourth dollar-denominated bond offering in 2020 with the agency issuing $4.75 billion of notes so far.

“For Kommuninvest, the U.S. market continues to present favorable conditions,” the agency said. “The pricing is well in line with the SEK market.”

The Rule 144A and Regulation S deal attracted orders of more than $3 billion with over 65 investors participating.

Credit spreads ease

Meanwhile, an offering from Pershing Square Holdings, Ltd. (/BBB+/BBB) is expected soon. The company announced on Monday plans to price up to $500 million of senior notes in a Regulation S transaction.

The primary market was mostly quiet on Monday.

Bank of New York Mellon Corp. sold $582.5 million of 3.7% series H noncumulative perpetual preferred shares (Baa1/BBB/BBB+).

About $15 billion of high-grade bond supply is anticipated this week, according to syndicate sources.

The high-grade space was mixed on Tuesday.

The Markit CDX North American Investment Grade 35 index eased 1.42 bps to a spread of 59.82 bps.

The PIMCO Investment Grade Corporate Bond index closed up 0.34% to 115.37, while the iShares iBoxx Investment Grade Corporate Bond ETF gained 0.41% to 135.45.

Stocks were mixed on Tuesday after declining over Monday’s session.

The Dow Jones industrial average declined 0.8% after closing the previous day down 2.29%.

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