University of Alabama prices as week's issuance hits $8 billion; longer-dated munis widen

By Cristal Cody

Tupelo, Miss., July 18 - Municipal bonds traded weaker on Thursday in tandem with Treasuries as the week's issuance reached nearly $8 billion of new deals, market sources said.

"Munis were a little bit softer today," a trader said. "Treasuries were down a point, so munis fell 2 to 3 basis points 10 years and out."

The short end traded mostly unchanged on the day.

The Board of Regents of the University of Alabama priced $98.75 million of series 2013 general revenue bonds (Aa2/AA-/) in two tranches competitively on Thursday, said Rory Hartley, financial adviser with Protective Securities.

"The issuer was pleased with the results," he said. "There were 11 total bidders on the D1 [tranche] and five on D-2."

Other issuers expected in the market on Thursday included the State of Florida with $206.66 million of Department of Transportation turnpike revenue refunding bonds, Virginia Public School Authority/Prince William County with a $62.43 million offering and California's Tulare County with a $56 million deal.

University of Alabama prices

The University of Alabama's offering included $20,425,000 of series 2013D-1 bonds that priced at par to yield 1.97% over the maturities from 2014 through 2023. The series 2013D-1 bonds priced with a true interest cost of 1.97%.

The second tranche of $78,325,000 of series 2013D-2 bonds priced with a 4.53% TIC. The bonds were sold with 5% to 4.25% coupons to yield 3.28% to 4.623% over the serial maturities from 2024 through 2035 and terms due 2037, 2039 and 2043.

Wells Fargo Bank, NA was the winning bidder for both tranches.

Protective Securities was the financial adviser.

Proceeds will be used to finance the construction of a new residence hall at the university's Birmingham campus.

South Carolina Public Service Authority plans $1.75 billion

A $1.75 billion offering of revenue obligation bonds (Aa3/AA-/AA-) is in the works from South Carolina Public Service Authority, according to a preliminary official statement.

The negotiated offering includes $811 million of series 2013A tax-exempt bonds, $399 million of series 2013B tax-exempt refunding bonds, $212 million of series 2013C taxable bonds and $326 million of series 2013D taxable Libor index bonds.

The series 2013A bonds are due 2043, 2048 and 2053.

The series 2013B refunding bonds are due 2037 and 2046.

The series 2013C bonds are due 2042.

The series 2013D bonds are due in 2015 and 2016.

Goldman Sachs & Co. is the bookrunner for the series A and B bonds. Barclays is the bookrunner for the series C bonds, and Morgan Stanley & Co. LLC is the bookrunner for the series D bonds.

Proceeds will be used to fund a portion of the authority's ongoing capital improvement program and to refinance a portion of outstanding debt.

New York to price $500 million

The City of New York is on the calendar with a $500 million offering of fiscal series 2014A general obligation bonds via negotiated and competitive sales, according to a preliminary official statement.

The city will sell $375 million of sub-series A-1 tax-exempt bonds through a negotiated offering and $125 million of sub-series A-2 taxable bonds via a competitive sale on Wednesday.

J.P. Morgan Securities Inc. is the bookrunner for the negotiated offering.

Public Resources Advisory Group is the financial adviser on the competitive sale.

The bonds have serial maturities from 2015 through 2039.

Proceeds will be used for capital purposes.

Minnesota plans $470.21 million

Looking ahead, the State of Minnesota intends to price $470,205,000 of G.O. state bonds through a competitive sale on Aug. 6, according to a preliminary official statement.

The deal includes $265,205,000 of series 2013A various-purpose bonds, $200 million of series 2013B trunk highway bonds and $5 million of series 2013C taxable state bonds.

The series 2013A and 2013B bonds have serial maturities from 2014 through 2033.

The series 2013C bonds are due Aug. 1, 2018.

Public Resources Advisory Group is the financial adviser.

Proceeds will be used to finance capital projects and state highway construction and to develop the state's agricultural resources by financing Rural Finance Authority programs.

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