Shortened session sees light activity; New York State Thruway to offer $450.6 million bonds

By Aaron Hochman-Zimmerman and Sheri Kasprzak

New York, May 22 - With a shortened day ahead of the Memorial Day holiday, market insiders said activity in the municipals market was positively dead. Traders noted the tone of the market remained flat.

"There is absolutely nothing going on today," noted one sellside source reached during the early afternoon.

"Next week is pretty slow as well. We've got a couple of good-sized deals, but there's more on the small side. Issuers are really leaning more toward several small deals than bringing out these gigantic offerings one at a time. The investors seem to digest the smaller portions easier than a big offering all at once."

Among the big deals for the coming week is a $450.68 million sale of series 2009A state personal income tax revenue bonds from the New York State Thruway Authority. That offering is set to come to market Thursday.

The bonds (/AAA/AA-) will be sold on a negotiated basis with RBC Capital Markets Corp. and Loop Capital Markets LLC as the senior managers.

The bonds are due 2010 to 2029.

Proceeds will be used to reimburse local governments for capital expenses for highway improvements.

Illinois Finance deal

Also coming up, the Illinois Finance Authority is expected to price $250 million in series 2009 revenue bonds for the Silver Cross Hospital and Medical Centers on Wednesday, according to a calendar of upcoming deals.

The bonds (/BBB/BBB+) will be sold on a negotiated basis with Goldman, Sachs & Co. as the senior manager.

Proceeds will be used to reimburse the hospital for costs related to constructing a replacement hospital and making a deposit to a debt service reserve fund.

Also on Wednesday, the Eastern Michigan University is set to price $102.765 million in series 2009 bonds, according to a sales calendar.

The bonds (A2/A/) will be sold on a negotiated basis with Piper Jaffray & Co. as the senior manager.

The bonds are due 2014 to 2023 with term bonds due 2029, 2034 and 2038.

Proceeds will be used to construct and renovate classroom buildings, as well as construct a science building.

ThedaCare sale on Tuesday

Coming up on Tuesday, the Wisconsin Health and Educational Facilities Authority is expected to price $127.39 million in series 2009 revenue bonds, according to a calendar of upcoming offerings.

The bonds will be sold on a negotiated basis with Merrill Lynch & Co. Inc. as the senior manager.

The sale includes $90 million in series 2009A bonds and $37.39 million in series 2009B bonds. The 2009A bonds are due 2011 to 2024 with term bonds due 2029 and 2038. The 2009B bonds are due 2009 to 2029.

Proceeds will be used to construct, equip and renovate health care facilities and to make a deposit to a debt service reserve fund.

Harris County to offer bonds

Also ahead, the Harris County Cultural Education Facilities Finance Corp., Texas, announced plans to issue a $200 million series 2009 hospital revenue bond on behalf of the Texas Children's Hospital Project (Aa2/AA/AA), according to a preliminary notice of sale.

J.P. Morgan Securities Inc., RBC Capital Markets and Merrill Lynch will act as underwriters for the negotiated issue.

Proceeds will be used to purchase and maintain hospital facilities and equipment.

Harris County Cultural Education Facilities Finance is located in Houston.

Michigan Housing bonds to come

The Michigan State Housing Development Authority plans to offer $102.67 million in two tranches of rental housing revenue bonds, according to a preliminary notice of sale.

The authority will sell $54.99 million in series A non-AMT bonds and $47.68 million in series B non-AMT bonds.

Series A will be comprised of $21.555 million of serial bonds due from 2011 to 2019 and $33.435 million in term bonds due 2024, 2029, 2034, 2039 and 2045.

Series B will be comprised of $39.805 million of serial bonds due from 2009 to 2019 and a $7.875 million term bond due 2022.

Merrill Lynch, Barclays Capital Inc. and JPMorgan will act as underwriters to the negotiated deal.

Proceeds will be used to finance home loans.

The Michigan State Housing Development Authority is located in Lansing, Mich.

Maine deal coming

Meanwhile, Maine is looking to bring to market $130.815 million in series 2009 general obligation bonds, according to a preliminary official statement.

The bonds (Aa3/AA/) will be sold on a negotiated basis with Citigroup Global Markets Inc. and Wachovia Bank as the lead managers.

The bonds are due 2010 to 2019.

Proceeds will be used to pay for general expenses.

Secondary market flattens

In the secondary market Friday, the market remained unmoved ahead of the holiday weekend.

"It's a really slow day," noted one trader reached in the late morning.

"We're not seeing a lot moving; things are really very flat."

Among the few bonds moving during the day was the Maine Educational Loan Authority in series 2009A-2 student loan revenue bonds. The 4.5% 2018 bonds were seen at 4.306% Friday afternoon. The bonds priced at par on Wednesday. The 2.4% 2011 bonds were seen at 2.235% after pricing at par. The 2.75% 2012s were seen at par after also pricing at par.

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