Morning Commentary: Deal action heavy; Duke, Entergy Mississippi, BNP, Buckeye to price

By Cristal Cody

Tupelo, Miss., Nov. 9 – Heavy high-grade deal action is expected over Thursday’s session with at least 10 reported issuers marketing bonds.

Duke Energy Carolinas, LLC intends to price 30-year first and refunding mortgage bonds.

Interstate Power and Light Co. plans to tap its 3.25% senior debentures due Dec. 1, 2024.

Entergy Mississippi, Inc. is on deck with an offering of first mortgage bonds.

Utility industry issuers were mostly out of the primary market at the start of the week due to the Edison Electric Institute’s annual financial conference that wrapped on Wednesday, a source said.

In other expected issuance, BNP Paribas talked an offering of 10-year senior notes to price at Treasuries plus 135 basis points, a source said.

Also, Brandywine Operating Partnership, LP plans to price new 10-year guaranteed notes and reopen its 3.95% guaranteed notes due Feb. 15, 2023.

American Financial Group, Inc. intends to tap its 3.5% senior notes due Aug. 15, 2026 and 4.5% senior notes due June 15, 2047.

In other expected primary action, Buckeye Partners, LP is marketing 10-year notes.

Alexandria Real Estate Equities, Inc. plans to sell guaranteed senior notes due 2025.

ITC Holdings Corp. announced an offering of five- and 10-year senior notes.

CNH Industrial NV intends to price a benchmark-sized and dollar-denominated offering of notes.

AT&T, Time Warner slip

In other activity, AT&T Inc.’s bonds (Baa1/BBB+/A-) traded mostly softer early Thursday, a market source said.

The moves follow reports that the Justice Department wants the company to sell Turner Broadcasting System, which owns CNN, or DirecTV before it will approve AT&T’s $85.4 billion cash and stock acquisition of Time Warner Inc.

The merger was expected to close before the end of the year.

AT&T’s 3.9% notes due Aug. 14, 2027 traded in the 99.06 area over the morning. The notes went out on Wednesday at 99.30.

AT&T sold $5 billion of the notes on July 27 at 99.827 to yield 3.92% and a spread of 160 bps over Treasuries.

The company plans to close on an $85.4 billion cash and stock acquisition of Time Warner (Baa2/BBB/BBB+) before the end of the year.

Time Warner’s 2.95% notes due July 15, 2026 were down at 94.87 early Thursday from 94.97 on Wednesday.

The New York-based media and entertainment company sold $800 million of the notes on May 5, 2016 at 98.70 to yield 3.1%, or a spread of Treasuries plus 135 bps.

The secondary market saw trading volume of $19.26 billion on Wednesday, compared to $19.8 billion on Tuesday and $14.08 billion on Monday, according to Trace.

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