By Cristal Cody
Tupelo, Miss., Feb. 7 – Tennessee Valley Authority priced $1 billion of 2.875% 10-year global power bonds to yield 2.884% or a spread of 48 basis points over Treasuries on Tuesday, according to a market source and a company release.
The bonds due Feb. 1, 2027 (Aaa//AAA) priced on the tight side of guidance that had been set in the Treasuries plus 50 bps area, plus or minus 2 bps.
BofA Merrill Lynch, Barclays, Mizuho Securities USA Inc. and Morgan Stanley & Co. LLC were the bookrunners.
The bonds are not callable before maturity.
Proceeds from the offering will be used to refinance existing debt or for other power system purposes.
Tennessee Valley Authority is a Knoxville, Tenn.-based corporate agency of the United States of America that provides electricity and is responsible for managing the Tennessee River and its tributaries to provide flood control, navigation and land management.
| Issuer: | Tennessee Valley Authority
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| Amount: | $1 billion
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| Description: | Global power bonds
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| Maturity: | Feb. 1, 2027
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| Bookrunners: | BofA Merrill Lynch, Barclays, Mizuho Securities USA Inc. and Morgan Stanley & Co. LLC
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| Coupon: | 2.875%
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| Yield: | 2.884%
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| Spread: | Treasuries plus 48 bps
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| Trade date: | Feb. 7
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| Price guidance: | Treasuries plus 50 bps area, plus or minus 2 bps
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| Call feature: | None
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| Ratings: | Moody’s: Aaa
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| Fitch: AAA
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