Morning Commentary: Roper, KKR, Retail Properties, Globe Life, Athene, KfW, SEK on tap

By Cristal Cody

Tupelo, Miss., Aug. 18 – Steady supply is expected in the high-grade bond market on Tuesday following heavy volume at the start of the week, according to informed sources.

Roper Technologies, Inc. is marketing four tranches of fixed-rate senior notes (Baa2/BBB+) to fund its acquisition of Vertafore, Inc.

A tranche of two-year notes is initially talked to price with a spread in the Treasuries plus 65 basis points area, a five-year note is talked at the 100 bps spread area, a seven-year tranche is guided to price at the 115 bps over Treasuries area and a tranche of notes due in 2031 is talked at the 130 bps spread area.

Meanwhile, KKR & Co. Inc. subsidiary KKR Group Finance Co. VIII LLC is marketing a $500 million Rule 144A and Regulation S offering of 30-year senior notes (A/A) with initial guidance at the Treasuries plus 262.5 bps area.

Retail Properties of America, Inc. is offering $350 million of new 10-year senior notes (Baa3/BBB-) on Tuesday. Initial price talk is at the Treasuries plus 450 bps area.

Globe Life Inc. is on deck with $300 million of registered 10-year senior notes (Baa1/A/BBB+) talked to price with a spread in the 165 bps over Treasuries area.

Athene Global Funding is in the day’s deal pipeline with FA-backed seven-year senior secured notes (A/A) that are initially guided at the Treasuries plus 220 bps to 225 bps area.

In other corporate supply, Prudential Financial, Inc. plans to price two tranches of notes (Baa1/BBB+). The deal includes fixed-to-fixed reset rate junior subordinated notes due Oct. 1, 2050 talked at the 4.125% to 4.25% area and $200 million of $25-par junior subordinated notes due Sept. 1, 2060 talked at the 4.5% area.

Tuesday’s session also is expected to post new sovereign, supranational and agency issuance.

KfW (Aaa/AAA/AAA) launched $2 billion of 10-year green global notes at mid-swaps plus 16 bps.

The notes were initially talked to price at the mid-swaps plus 19 bps area.

The offering was upsized from $1 billion.

Also, Swedish Export Credit Corp. is marketing $1 billion of five-year global notes (Aa1/AA+) guided to print at the mid-swaps plus 19 bps area, revised from initial talk at the mid-swaps plus 20 bps area.

Deal volume totaled more than $21 billion on Monday with supply led by Intercontinental Exchange Inc.’s $6.5 billion of senior notes (A3/BBB+) priced in five tranches.

About $30 billion to $40 billion of issuance is expected by market participants this week.

The session opened to a positive tone with the Pimco Investment Grade Corporate Bond index up 0.31% at $115.64.

The iShares iBoxx Investment Grade Corporate Bond ETF gained 0.18% to $135.94.

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