National Oilwell, Goldman, Roper, sovereigns fill primary market; Goldman Sachs notes flat

By Aleesia Forni and Andrea Heisinger

New York, Nov. 15 - Although there were no megadeals in the high-grade market on Thursday, roughly $7.5 billion of new corporate bonds was introduced to the primary.

National Oilwell Varco, Inc. sold $3 billion of notes in tranches due 2017, 2022 and 2042. All of the bonds were priced at the tight end or much lower than price guidance.

There was an upsized $1.75 billion sale in two parts from Goldman Sachs Group Inc. The financial services company added a two-year floating-rate note to the original offering of three-year bonds.

Roper Industries, Inc. tapped the market for $900 million of notes due 2017 and 2022.

A $650 million sale of first mortgage bonds in two tranches came from Florida Power Corp. (d/b/a Progress Energy Florida, Inc.).

Diversified manufacturer Carlisle Cos. Inc. priced $350 million of 10-year notes after the size was increased from $300 million.

TTX Co. sold $250 million of 10-year medium-term notes under Rule 144A and Regulation S.

There were some sovereigns in the market, including Inter-American Development Bank, which priced $500 million of three-year floating-rate notes.

Province of Ontario priced $$250 million of five-year floaters.

Preferred stock sales kept coming out of the woodwork as First Republic Bank announced a sale of $25-par perpetual shares.

Prudential Financial Inc. gave the terms of its $1.5 billion sale of $1,000-par fixed-to-floating-rate junior subordinated notes due 2043.

Spreads on investment-grade bonds were wider on the day due to the continued talk of the so-called fiscal cliff and tensions in the Middle East, a syndicate source said.

He added that some positive economic data on France and Germany's GDPs helped balance out any negativity.

Friday could have some trades if the tone doesn't suffer overnight, sources said at the end of the day.

"I'm hearing of a couple of things," one source who worked on the National Oilwell sale said.

A market source noted that it "maybe won't be the typical boring Friday."

The Markit CDX Series 18 North American Investment Grade index widened 2 bps to a spread of 111 bps on Thursday.

The new Goldman Sachs' fixed-rate notes were seen trading right at new issue price near the end of the day.

In recent deals, General Electric Capital Corp.'s notes were seen unchanged during the session, while Tuesday's issue from Macy's Retail Holdings Inc. traded wider.

Investment-grade bank and brokerage credit default swaps costs rose on Thursday.

Bank of America's CDS costs widened 4 bps to 158 bps bid, 163 bps offered. Citi's CDS costs were also 4 bps wider at 154 bps bid, 159 bps offered. J.P. Morgan's CDS costs were unchanged at 103 bps bid, 108 bps offered. Wells Fargo's CDS costs rose 1 bps to 83 bps bid, 88 bps offered.

Merrill Lynch's CDS costs were 4 bps wider at 152 bps bid, 162 bps offered. Morgan Stanley's CDS costs rose 6 bps to 226 bps bid, 231 bps offered. Goldman Sachs' CDS costs rose 4 bps to 186 bps bid, 191 bps offered.

National Oilwell tight

National Oilwell Varco sold $3 billion of senior notes (A2/A-/) in three maturities, a source close to the trade said.

There was roughly $8.75 billion of investor interest on the books, the source added.

The $500 million of 1.35% five-year notes sold at a spread of Treasuries plus 75 bps. The tranche sold tighter than initial guidance in the 107.5 bps area, plus or minus 2.5 bps.

A $1.4 billion tranche of 2.6% 10-year notes priced at a spread of 105 bps over Treasuries. These notes also sold tighter than initial talk in the 127.5 bps area, plus or minus 2.5 bps.

Finally, a $1.1 billion tranche of 3.95% 30-year bonds sold at Treasuries plus 125 bps. The bonds were priced at the lowest end of guidance in the 127.5 bps area, plus or minus 2.5 bps.

Barclays, J.P. Morgan Securities LLC and Wells Fargo Securities LLC were active bookrunners.

Proceeds are being used to fund the $2.5 billion of the purchase price for Robbins & Myers and for general corporate purposes.

The maker of equipment and components for oil and natural gas drilling is based in Houston.

Goldman Sachs' $1.75 billion

Goldman Sachs Group was in the market with an upsized $1.75 billion sale of notes (A3/A-/A) in two tranches, a source away from the trade said.

The size was talked in the $1 billion area, with a tranche of two-year floating-rate notes added prior to the launch.

That $500 million of two-year floaters priced at par to yield Libor plus 100 bps.

A $1.25 billion tranche of 1.6% three-year notes sold at a spread of Treasuries plus 130 bps. This was in line with guidance in the 130 bps area.

A trader quoted the notes at 130 bps bid, 124 bps offered late in the session.

Goldman Sachs & Co. was bookrunner.

The financial services company is based in New York City.

Progress sells in two parts

Progress Energy Florida tapped the market for $650 million of first mortgage bonds (A2/A/A) in two maturities, an informed source said.

The $250 million of 0.65% three-year notes sold at a spread of Treasuries plus 35 bps.

A $400 million tranche of 3.85% 30-year bonds priced at Treasuries plus 115 bps.

Goldman Sachs & Co., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and RBC Capital Markets LLC were bookrunners.

Proceeds are being used to repay at maturity $425 million of 4.8% mortgage bonds due March 1, 2013, to repay intercompany short-term debt under a money-pool borrowing arrangement with Duke Energy Corp. and for general corporate purposes.

Progress Energy Florida last sold bonds in a $300 million sale of 10-year notes on Aug. 15, 2011.

The electric utility is based in St. Petersburg, Fla.

Roper prices senior notes

Roper Industries priced $900 million of senior notes (Baa2/BBB/) in two maturities, according to an FWP with the Securities and Exchange Commission.

A $400 million tranche of 1.85% five-year notes sold at a spread of Treasuries plus 125 bps.

There was also $500 million of 3.125% 10-year notes priced at 155 bps over Treasuries.

Bank of America Merrill Lynch, J.P. Morgan Securities LLC and Wells Fargo Securities LLC were bookrunners

Proceeds are being used to repay amounts outstanding under a $1.5 billion five-year revolving credit facility and for general corporate purposes.

Roper was last in the market with a $500 million sale of 6.25% 10-year notes priced at 280 basis points over Treasuries on Aug. 26, 2009.

The diversified industrial technology company is based in Sarasota, Fla.

Carlisle's upsized $350 million

Carlisle Cos. has priced an upsized $350 million of 3.75%10-year senior notes (Baa2/BBB/) at a spread of Treasuries plus 220 bps, a market source said.

The size of the trade was increased from $300 million.

Bank of America Merrill Lynch, J.P. Morgan Securities LLC and Wells Fargo Securities LLC were bookrunners.

Proceeds are being used for general corporate purposes, including repayment of outstanding borrowings under a credit facility and funding acquisitions.

The diversified manufacturer is based in Charlotte, N.C.

TTX offers $250 million

TTX priced $250 million of 3.05%10-year notes (Baa1/A+/) to yield Treasuries plus 150 bps, a market source said.

Pricing was done under Rule 144A and Regulation S.

Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC were bookrunners.

TTX last tapped the U.S. bond market with a $200 million sale of notes in two tranches on June 27, 2011. That offering included a reopening of 4.4% 10-year notes priced at 130 basis points over Treasuries.

The railroad freight company is based in Chicago.

Ontario brings floaters

The Province of Ontario has priced a $250 million sale of five-year floating-rate medium-term notes (Aa2/AA-/) at par to yield Libor plus 25 basis points, according to an FWP with the SEC.

Bookrunners were HSBC Securities (USA) Inc. and Morgan Stanley & Co. International plc.

IADB prices floaters

The Inter-American Development Bank sold $500 million of three-year floating-rate notes (Aaa/AAA/AAA) at par to yield Libor minus 2 bps, a market source told Prospect News.

Bookrunner was Credit Suisse Securities (USA) LLC.

The bank provides funding for development in Latin America and the Caribbean and is based in Washington, D.C.

First Republic preferreds

First Republic Bank announced plans to sell $25-par perpetual noncumulative series C preferred stock in a release on the company's website.

The shares are being talked in the 5.625% area, a trader said at midday.

Pricing could take place late on Thursday, he added.

"They already launched it so I would think they'd try to push it through today," the trader said.

There is a 1/40th ownership interest in each preferred.

Bank of America Merrill Lynch, Morgan Stanley & Co. LLC, Goldman Sachs & Co. and J.P. Morgan Securities LLC are bookrunners.

First Republic intends to list the shares on the New York Stock Exchange under the symbol "FRB-PrC."

Proceeds are being used for general corporate purposes including funding loans or buying investment securities for portfolios.

The commercial bank is based in San Francisco.

Taylor Capital preferreds

Taylor Capital Group priced $100 million, or 4 million shares, of 8% series A noncumulative perpetual preferred stock, according to an FWP filing with the Securities and Exchange Commission.

The shares were priced at par of $25. Pricing was in line with 8% talk.

The company has applied to list the new securities on the Nasdaq Global Market under the symbol "TAYCO."

Sandler O'Neill + Partners LPC was the bookrunner.

Proceeds will be used for business expansion and for general corporate purposes.

Taylor Capital is a Rosemont, Ill.-based holding company for Cole Taylor Bank.

Prudential's hybrid terms

Prudential Financial gave the terms of its $1.5 billion sale of 5.625% $1,000-par fixed-to-floating rate junior subordinated notes due June 15, 2043, according to an FWP with the Securities and Exchange Commission.

The notes will have a fixed rate up June 15, 2023. After that, there will be a floating rate of Libor plus 392 basis points.

The notes will not be listed.

Bookrunners were Barclays, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and Wells Fargo Securities LLC.

Proceeds will be used for general corporate purposes and to redeem some outstanding retail medium-term notes, including those issued under the InterNotes program.

Prudential is a Newark, N.J.-based financial services company.

GE Capital flat

The secondary market saw General Electric Capital's $1 billion 1.6% five-year notes trade flat from issue price at 100 bps bid, 98 bps offered, a market source said.

The Norwalk, Conn.-based funding arm of General Electric Co. sold the notes to yield Treasuries plus 100 bps on Wednesday.

Macy's weakens

In other trading, Macy's Retail Holdings Inc.'s notes due 2023 were quoted at 132 bps offered.

Though the source had not seen levels on the notes due 2032, she added that they were in the area of 162 bps bid to 165 bps bid, according to Trace data.

Macy's sold the $750 million of 2.87% 10-year notes at a spread of Treasuries plus 130 bps and the $250 million tranche of 4.3% 30-year bonds at a spread of 160 bps over Treasuries on Wednesday.

The department store holding company is based in Cincinnati.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.