University of Cincinnati prices $99.8 million variable-rate bonds; Massachusetts Housing brings $60 million

By Aaron Hochman-Zimmerman and Sheri Kasprzak

New York, Nov. 21 - Pricing activity tapered off on Friday ahead of a short holiday week, and new issue activity is already looking slim as Thanksgiving approaches.

"We're seeing tons of stuff after Thanksgiving," said one sellside source reached Friday afternoon.

"Next week looks dead. Not a lot getting done at all. Most people are holiday-focused next week."

That won't stop some issuers from coming to market with some smaller sales. The Harris County Cultural Education Facilities Finance Corp. will sell $133.2 million in series 2008D hospital revenue bonds for Memorial Hermann Healthcare Systems of Texas on Tuesday.

And the City of Yonkers in New York is gearing up to sell $65.4 million in series 2008-09 revenue anticipation notes and bond anticipation notes Tuesday as well.

U of Cincinnati sells bonds

Moving back to Friday's light pricing activity, the University of Cincinnati sold $99.8 million series 2008F variable-rate demand general receipts bonds (Aa2/AAA/), according to university treasurer Bill Doering.

RBC Capital Markets was the lead underwriter for the issue due June 1, 2034.

The bonds priced at a weekly mode with an initial rate of 1.2%.

The bonds are supported by a letter of credit from Bayerische Landesbank.

The issuer may also elect to have a portion of the bonds converted to a different interest rate, which would trip a mandatory tender on a conversion date for purchase at par plus accrued interest.

Proceeds will be used to refinance the 2004B issue and fund new construction.

Mass Housing deal prices

In other pricing news Friday, the Massachusetts Housing Finance Agency brought $60 million in series 140 single-family housing revenue bonds, said Eric Gedstadt, spokesman for the agency.

The bonds (Aa2/AA/) priced Friday through lead manager Goldman, Sachs & Co.

The bonds are due from 2009 to 2018 with term bonds due 2024, 2028, 2037 and 2039. The serials have coupons from 1.9% to 4.7%, all priced at par. The 2024 bonds have a 5.5% coupon, the 2028 bonds have a 5.8% coupon, the 2037 bonds have a 6% coupon and the 2039 bonds have a 6.05% coupon, all priced at par.

Proceeds will be used for the purchase of mortgage loans.

Virginia Resources bonds

The Virginia Resources Authority priced $218.985 million in series 2008B infrastructure revenue bonds Thursday, said Mary Barnes, the authority's director of financial services.

The authority sold $150.375 million in senior bonds (Aaa/AAA/) and $68.61 million in subordinate bonds (Aa2/AA/). The senior bonds are due 2009 to 2038 with coupons from 3% to 5.25% and yields from 1.14% to 5.33%. The subordinate bonds are also due 2009 to 2038 with coupons from 3% to 5.25% and yields from 1.5% to 5.6%.

The true interest cost for the bonds came to 5.16%, said Barnes.

Citigroup Global Markets was the senior manager for the negotiated deal. The co-managers were Morgan Keegan & Co., Banc of America Securities, BB&T Capital Markets, Goldman Sachs, Loop Capital Markets, Morgan Stanley, M.R. Beal & Co. and Wachovia Securities.

Proceeds will be used for financing or refinancing public water, wastewater, parks and recreation, public safety, transportation and local government projects.

Indiana Finance Authority sale

Elsewhere, the Indiana Finance Authority priced $96.475 million in series 2008 revenue refunding bonds on Thursday, said a pricing sheet released Friday by the issuer.

The bonds (Aa2/AA+/AA) were sold through lead manager Morgan Stanley.

The sale included $29.715 million in series 2008A bonds, which are due from 2009 to 2020 with coupons from 2% to 5% and yields from 2% to 5.2%.

The deal also included $13.725 million in series 2008B bonds, which are due 2015 with a 5% coupon to yield 3.45%, as well as $53.035 million in series 2008C bonds, which are due 2009 to 2018 with term bonds due 2020 and 2022. The serials have coupons from 2% to 5% with yields from 2% to 5.35%. The 2020 bonds have a 5% coupon to yield 5.2%, and the 2022 bonds have a 5.25% coupon to yield 5.35%.

Proceeds will be used to refund the authority's series 2000A, 2000B and 2001A bonds and to make interest rate collar termination payments.

Eastern Carolina health sale

In other offerings priced earlier this week, the University Health Systems of Eastern Carolina sold $508.6 million in bonds (A1/A+/AA-) on Wednesday, said Chris Taylor with the health system Friday.

The series 2008 A-1 and A-2 each priced $56 million 3.452% bonds at par with an average life of 12.15 years, and the series 2008 B-1 and B-2 each priced $62 million 3.472% bonds at par with an average life of 12.89 years. The maturities ranged from 2009 to 2036.

University Health Systems also priced term bonds with coupons ranging from 3.27% to 6.75%.

"It went well, considering," Taylor said. "Yes, we got the yields we were expecting."

Proceeds from the sale went to refund the commission's 2006 bonds and make a deposit to a debt service reserve fund.

Hawaii to price G.O.s

Looking ahead to a large slate of sales planned for after Thanksgiving, the State of Hawaii is planning to sell its long-awaited $634.735 million in series 2008 general obligation and G.O. refunding bonds. The state is hoping to sell the bonds Dec. 1, said a source at the issuer, but that may change with market conditions.

The state had planned to sell the bonds (Aa2/AA/AA) in late September, but the deal was put off after market conditions went south.

The sale includes $300 million in series 2008DN G.O. bonds, $308.735 million in series 2008DO G.O. refunding bonds and $26 million series 2008DP G.O. bonds.

The 2008DN bonds are due 2012 to 2028. The 2008DO bonds are due 2011 to 2018, and the 2008DP bonds are due 2011 to 2016.

Citigroup Global Markets and Merrill Lynch & Co. are the lead managers for the negotiated deal.

Proceeds will be used to reimburse the state for public improvement expenses and the costs of acquiring, constructing, extending or improving various public buildings and facilities. The rest will be used for refunding a number of the state's obligations.

Lower Colorado River offering

In other upcoming sales, the Lower Colorado River Authority in Texas is scheduled to sell $300 million in series 2008A refunding and improvement revenue bonds on Dec. 3, said a preliminary official statement.

The bonds (A2/A/) will be sold on a negotiated basis with Morgan Stanley as the senior manager.

The bonds are due from 2009 to 2018 with term bonds due 2023, 2028 and 2037.

Proceeds will be used for the refunding of outstanding commercial paper notes and for making a deposit to a debt service reserve fund.

On Dec. 4, the Southern California Public Power Authority is slated to price $104.56 million in series 2008A Canyon Power Project revenue notes, said a preliminary official statement.

The notes (MIG 1/SP-1+/F1+) will be sold on a negotiated basis with Citigroup Global Markets as the lead manager.

The notes are due Dec. 2, 2009.

Proceeds will be used as interim financing to construct, develop and acquire the Canyon Power Project.

U of Chicago sale

Also coming up, the Illinois Finance Authority plans to price $500 million in series 2008B revenue bonds for the University of Chicago, said a preliminary official statement.

The bonds will be sold on a negotiated basis with J.P. Morgan Securities Inc. and Banc of America Securities as the senior managers.

The maturities have not yet been set for the sale.

Proceeds will be used for financing, refinancing or reimbursing the University of Chicago for the costs of the construction, acquisition, equipment or renovation of educational facilities on campus.

California transmission agency deal

Also ahead, the Transmission Agency of Northern California is expected to price $424.475 million in series 2008 California-Oregon Transmission Project revenue refunding bonds, said a preliminary official statement.

The bonds (/A+/A+) will be sold on a negotiated basis with J.P. Morgan Securities as the lead manager.

The sale includes $104.485 million in series 2008A bonds, $229.615 million in series 2008B bonds, $32.05 million in series 2008C bonds and $58.325 million in series 2008D bonds.

The 2008A bonds are due 2009 to 2020 with a term bond due 2029. The 2008B bonds are due 2014 to 2020 with a term bond due 2029, and the 2008C bonds are due 2019 to 2020 with a term bond due 2029. The 2008D bonds are due 2009 to 2018.

Proceeds will be used for retiring the agency's series 2002 and 2003 bonds as well as for retiring the agency's commercial paper notes.

Wisconsin water deal

In other upcoming offerings, the State of Wisconsin plans to price $100 million in series 2008-3 clean water revenue bonds, according to a preliminary official statement.

The bonds will be sold on a negotiated basis with Morgan Stanley as the senior manager. The co-managers are M.R. Beal and Merrill Lynch.

The bonds are due from 2010 to 2029.

Proceeds will be used for making pledged loans to municipalities for improvements to wastewater treatment facilities.

Secondary seen a touch off

To round out the week, the secondary muni market was seen a touch weaker, according to a trader reached Friday afternoon.

"I would call it a little off today," said the trader. "Light trading. Not a whole lot to report."

Seen in play Friday was the City of New York's series 2009F bonds. The 5% 2012s were seen trading at 3.26%, and the 4% 2013s were seen at 3.57%. The 4% 2015s were trading at 3.85% On the long end, the 5.625% 2031s were seen trading at 5.7%.

© 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.