UnitedHealth, Western Union price; Ford Foundation offers bonds; Burlington Northern softens

By Cristal Cody

Tupelo, Miss., March 8 – Investment-grade issuers priced about $4 billion of bonds over Wednesday’s session.

UnitedHealth Group Inc., Realty Income Corp., DTE Energy Co. and Western Union Co. tapped the primary market.

In addition, Municipality Finance plc sold $1 billion of five-year notes on Wednesday.

The Trustees of Princeton University also placed $150 million of 31-year bonds.

Looking ahead, the Ford Foundation is expected to price a $280 million 30-year bullet bond later in the month.

The Markit CDX North American Investment Grade index eased about 1 basis point over the day to a spread of 63 bps.

In the secondary market, Burlington Northern Santa Fe, LLC’s $1.25 billion of senior debentures (A3/A/) priced in two parts on Monday remained soft on Wednesday.

UnitedHealth raises $1.35 billion

UnitedHealth Group priced $1.35 billion of fixed-rate senior notes (A3/A+/A) in two parts on Wednesday, according to a market source.

The company sold $625 million of 3.375% 10-year notes at a spread of 87.5 bps over Treasuries.

UnitedHealth Group priced $725 million of 4.25% 30-year notes at a Treasuries plus 110 bps spread.

The notes priced on the tight side of guidance.

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

Proceeds will be used for general corporate and working capital purposes, according to a 424B5 filing with the Securities and Exchange Commission.

UnitedHealth is a diversified health company based in Minnetonka, Minn.

Municipality Finance prices

Municipality Finance sold $1 billion of 2.375% five-year notes (Aa1/AA+/) on Wednesday at a spread of 37.25 bps over Treasuries, a market source said.

BMO Capital Markets Corp., J.P. Morgan Securities, Mizuho Securities USA Inc. and Morgan Stanley were the bookrunners for the Rule 144A and Regulation S offering.

Municipality Finance is a Helsinki, Finland-based credit institution that provides funding for the public sector in Finland.

Realty Income sells notes

Realty Income priced $700 million of senior notes (Baa1/BBB+/BBB+) in two parts on Wednesday, according to a market source and an FWP filing with the SEC.

The company brought a $400 million reopening of its 4.125% senior notes due Oct. 15, 2026 at 102.977 to yield 3.752% and a spread of Treasuries plus 120 bps.

Realty Income originally sold $250 million of the notes at 98.499 to yield 4.178%, or 160 bps over Treasuries, in an offering on Sept. 16, 2014.

The company priced $300 million of new 4.65% 30-year notes at 99.968 to yield 4.652%, or Treasuries plus 150 bps.

Both tranches were sold on the tight side of talk.

Citigroup Global Markets Inc., Barclays, BNY Mellon Capital Markets LLC, Goldman Sachs, Credit Suisse Securities (USA) LLC, J.P. Morgan Securities, BofA Merrill Lynch, Morgan Stanley, RBC Capital Markets, LLC, Regions Securities LLC, UBS Securities LLC, U.S. Bancorp Investments, Inc. and Wells Fargo Securities, LLC were the bookrunners.

Proceeds will be used to repay borrowings under the company’s $2 billion revolving credit facility and, with proceeds from additional borrowings under the revolver, to redeem all outstanding class F preferred shares, for potential investment opportunities and for other general corporate purposes.

The real estate investment trust for retail and commercial properties is based in Escondido, Calif.

DTE Energy sells $500 million

DTE Energy sold $500 million of 3.8% 2017 series A 10-year senior notes on Wednesday at 99.736 to yield 3.832%, according to a market source and an FWP filing with the SEC.

The notes due March 15, 2027 (Baa1/BBB/BBB+) priced at a spread of 128 bps over Treasuries, on the tight side of guidance.

Barclays, BNP Paribas Securities Corp., Citigroup Global Markets, J.P. Morgan Securities and Scotia Capital (USA) Inc. were the bookrunners.

Proceeds will be used for repayment of short-term borrowings with an average interest rate of about 0.85% and maturities under 30 days and for general corporate purposes.

DTE is a Detroit-based diversified energy company.

Western Union brings notes

Western Union sold $400 million of 3.6% five-year senior notes on Wednesday at a spread of Treasuries plus 155 bps, according to a market source.

The notes (Baa2/BBB/BBB+) priced in the middle of guidance in the Treasuries plus 155 bps area, plus or minus 5 bps.

The bookrunners were Barclays, BofA Merrill Lynch and Citigroup Global Markets.

Proceeds will be used for general corporate purposes, according to a 424B5 filing with the SEC.

Western Union is an Englewood, Colo.-based money transfer network.

Princeton Trustees prices

The Trustees of Princeton University priced $150 million of 3.84% series 2017A taxable bonds due July 1, 2048 (Aaa/AAA/) on Wednesday at a spread of 68 bps over Treasuries, according to a market source.

Goldman Sachs was the bookrunner.

The Trustees of Princeton University is a 40-member board responsible for the overall direction of the university.

Ford Foundation markets bonds

The Ford Foundation is expected to price $280 million of 30-year 3(a)4 exempt taxable bullet bonds in an offering on March 14, according to a market source.

The series 2017 bonds (Aaa//) are due June 1, 2047.

Wells Fargo Securities LLC and Citigroup Global Markets Inc. are the lead managers.

Proceeds will be used to fund the renovation of the headquarters building and related costs and payment of swap termination fees.

Ford Foundation is a New York City-based private foundation formed with bequests by Edsel and Henry Ford that seeks to reduce poverty and injustice, strengthen democratic values, promote international cooperation and advance human achievement.

Burlington Northern softens

Burlington Northern Santa Fe’s 3.25% debentures due June 15, 2027 remained soft on the day at 99.54 from where the notes went out in the previous session at 99.71, according to a market source.

The company priced $500 million of the debentures on Monday at 99.747 to yield 3.278%, or a spread of Treasuries plus 78 bps.

Burlington Northern Santa Fe’s 4.125% debentures due June 15, 2047 recovered some over the day to head out at 97.48 from where the bonds traded at 96.97 over the morning. The notes last traded on Tuesday at 98.49.

The $750 million tranche priced on Monday at 98.857 to yield 4.191% and a Treasuries plus 108 bps spread.

The holding company for railroad transportation subsidiaries is based in Fort Worth.

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