ConocoPhillips, Stryker price ahead of jobs data; AstraZeneca gains; Procter & Gamble eases

By Aleesia Forni and Cristal Cody

New York, March 3 – ConocoPhillips Co., Stryker Corp. and Xcel Energy Inc. took advantage of supportive conditions to access the investment-grade primary ahead of Friday’s all-important jobs data.

The session’s $9.45 billion of supply pushes the week’s total to a staggering $51 billion.

Even with the deluge of issuance opening the month of March, the market showed no signs of a slowdown, while a number of deals priced during the session saw significant spread tightening from initial price thoughts.

ConocoPhillips brought in pricing on its deal by between 56 basis points to 82 bps on the three tranches of its new issue. Tranches of Stryker’s new deal firmed between 20 basis points to 35 bps.

Financial names Swedish Export Credit Corp. and KeyBank NA, Cleveland also sold bonds on Thursday.

In Canada, Toronto-Dominion Bank priced a C$1.5 billion offering of 3.405% five-year deposit notes priced at par to yield a spread of 136 bps over the interpolated Government of Canada bond curve.

The deal “was hugely successful,” an informed source said.

The bank attracted more than 75 buyers and the book was in excess of C$3.5 billion.

Investment-grade credit spreads continued to improve over the day. The Markit CDX North American Investment Grade index ended 3 bps tighter at a spread of 98 bps.

In the secondary market, high-grade bonds were mixed.

AstraZeneca plc’s 3.375% senior notes due 2025 tightened 7 bps on Thursday following the company’s announcement of federal approval for expansion of its breast cancer drug in the U.S. market.

Procter & Gamble Co.’s 2.7% notes due 2026 traded 3 bps weaker over the day.

Stryker’s four-parter

Stryker priced a $3.5 billion offering of senior notes (Baa1/A) in four parts on Thursday, according to a market source.

A $750 million 2% tranche of three-year notes sold at Treasuries plus 105 basis points.

Also, $750 million of 2.625% five-year notes sold with a spread of Treasuries plus 130 bps.

The company also issued $1 billion of 3.5% 10-year bonds at Treasuries plus 175 bps.

Finally, $1 billion of 4.625% 30-year bonds sold with a 205 bps spread over Treasuries.

A floating-rate tranche of three-year notes was dropped prior to the deal’s launch.

BofA Merrill Lynch, Citigroup Global Markets Inc., Goldman Sachs & Co. and J.P. Morgan Securities LLC are the bookrunners.

Proceeds will be used to fund the acquisitions of Sage Products Holdings II, LLC and Physio-Control International Inc. The company will also use proceeds to repay its 2% notes due Sept. 30, 2016 and for general corporate purposes.

Stryker is a medical technology company based in Kalamazoo, Mich.

Conoco new issue

Elsewhere, ConocoPhillips sold $3 billion of senior notes (Baa2/A/A-) in three tranches on Thursday, according to a market source.

The deal included $1.25 billion of 4.2% five-year notes sold at 99.95 to yield 4.211%, or Treasuries plus 287.5 bps.

Pricing came at the tight side of the Treasuries plus 300 bps area guidance. Initially, talk was in the Treasuries plus 337.5 bps to 350 bps range.

Also $1.25 billion of 4.95% 10-year bonds sold at 99.96 to yield 4.955% with a spread of 312.5 bps over Treasuries.

The notes were guided in the Treasuries plus 325 bps area and initially talked in the Treasuries plus 362.5 bps to 375 bps range.

Finally, $500 million of 5.95% 30-year bonds sold with a 337.5 bps spread over Treasuries. Pricing was at 98.977 to yield 6.024%.

Guidance was in the area of Treasuries plus 350 bps, having firmed from the range of Treasuries plus 412.5 bps to 425 bps.

The securities are guaranteed by ConocoPhillips.

Mizuho Securities, Barclays, HSBC Securities, J.P. Morgan Securities LLC, BofA Merrill Lynch, Citigroup Global Markets Inc., Credit Agricole and Deutsche Bank Securities Inc. are the bookrunners.

Proceeds will be used for general corporate purposes.

ConocoPhillips is a Houston-based energy company.

KeyBank bank notes

In other primary happenings, KeyBank sold $1 billion of 2.35% three-year senior bank notes (A3/A-/A-) at 137.5 bps over Treasuries, a market source said.

The issue sold at 99.951 to yield 2.367%.

Pricing came at the tight side of the 140 bps area over Treasuries guidance, which firmed from the 155 bps area over Treasuries.

Goldman Sachs & Co., J.P. Morgan Securities LLC, KeyBank and Morgan Stanley & Co. LLC were the bookrunners.

The Cleveland-based financial services company plans to use the proceeds for general corporate purposes.

Xcel new, reopened notes

Xcel Energy priced a $750 million issue of senior notes (A3/BBB+/BBB+) in new and reopened tranches on Thursday, according to an informed source.

There was $400 million of 2.4% five-year notes sold at 99.972 to yield 2.406%, or Treasuries plus 107 bps.

The issue was sold at the tight side of guidance set in the 110 bps area over Treasuries. Initial talk was in the Treasuries plus 125 bps to 130 bps range.

The company also priced a $350 million add-on to its existing $250 million of 3.3% notes due June 1, 2025.

The add-on sold at 100.685 to yield 3.209%, or Treasuries plus 137 bps.

Barclays, BNP Paribas Securities Corp., Morgan Stanley & Co. LLC, MUFG and Wells Fargo Securities LLC are the bookrunners.

Proceeds will be used to fund the repayment of the company’s $450 million of 0.75% senior notes due May 9, 2016, to repay short-term debt and for other general corporate purposes.

The public utility holding company is based in Minneapolis.

Swedish Export prices tight

Swedish Export Credit priced $1.2 billion of 1.75% five-year notes on Thursday at mid-swaps plus 59 bps, according to a market source and an FWP filed with the Securities and Exchange Commission.

The notes (Aa1/AA+) were guided in the mid-swaps plus 60 bps area.

Pricing was at 99.52 to yield 1.851%, or Treasuries plus 50.7 bps.

Bookrunners were Mizho Securities, Morgan Stanley & Co. and TD Securities.

Based in Stockholm, Swedish Export Credit is the lender to Sweden’s export industry.

AstraZeneca improves

In secondary trading, AstraZeneca’s 3.375% notes due 2025 firmed 7 bps over the session to 142 bps bid, a market source said.

The company sold $2 billion of the notes (A2/A) on Nov. 10 at a spread of Treasuries plus 115 bps.

The biopharmaceutical company is based in London.

Procter & Gamble eases

Meanwhile Procter & Gamble’s 2.7% notes due 2026 eased 3 bps on Thursday to 77 bps bid in the secondary market, a source said.

The company sold $600 million of the notes (Aa3/AA-) on Jan. 28 at 75 bps over Treasuries.

The consumer products company is based in Cincinnati.

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