Published on 3/9/2017 in the Prospect News Investment Grade Daily.
New Issue: UnitedHealth details $1.35 billion 10-, 30-year senior notes sale
By Devika Patel
Knoxville, Tenn., March 9 – UnitedHealth Group Inc. offered further details about a $1.35 billion offering of fixed-rate senior notes (A3/A+/A) that priced in two parts on Wednesday, according to an FWP filed with the Securities and Exchange Commission.
The company sold $625 million of 3.375% 10-year notes at 99.489 for a yield of 3.435%, with a spread of 87.5 basis points over Treasuries.
UnitedHealth Group priced $725 million of 4.25% 30-year notes at 99.81 for a yield of 4.261%, with a spread of a Treasuries plus 110 bps spread.
The notes priced on the tight side of guidance.
J.P. Morgan Securities LLC, BofA Merrill Lynch, Goldman Sachs & Co. and Morgan Stanley & Co. LLC were the bookrunners.
Proceeds will be used for general corporate and working capital purposes, according to a 424B5 filing with the Securities and Exchange Commission.
UnitedHealth is a diversified health company based in Minnetonka, Minn.
| Issuer: | UnitedHealth Group Inc.
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| Amount: | $1.35 billion
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| Description: | Senior notes
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| Bookrunners: | J.P. Morgan Securities LLC, BofA Merrill Lynch, Goldman Sachs & Co. and Morgan Stanley & Co. LLC
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| Co-managers: | Barclays, BB&T Capital Markets, BMO Capital Markets Corp., BNY Capital Markets Inc., Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Drexel Hamilton, LLC, Fifth Third Securities Inc., Huntington Investment Co., KeyBanc Capital Markets Inc., Mizuho Securities USA Inc., PNC Capital Markets LLC, RBC Capital Markets Corp., Regions Securities LLC, SunTrust Robinson Humphrey Inc., U.S. Bancorp Investments Inc., Wells Fargo Securities LLC and Williams Capital Group LP
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| Trade date: | March 8
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| Settlement date: | March 13
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| Ratings: | Moody’s: A3
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| S&P: A+
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| Fitch: A
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| Distribution: | SEC registered
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| 10-year notes
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| Amount: | $625 million
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| Maturity: | April 15, 2027
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| Coupon: | 3.375%
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| Price: | 99.489
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| Yield: | 3.435%
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| Spread: | Treasuries plus 87.5 bps
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| Call feature: | Make-whole call at Treasuries plus 15 bps
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| Price guidance: | Treasuries plus 90 bps area, plus or minus 2.5 bps
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| 30-year notes
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| Amount: | $725 million
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| Maturity: | April 15, 2047
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| Coupon: | 4.25%
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| Price: | 99.81
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| Yield: | 4.261%
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| Spread: | Treasuries plus 110 bps
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| Call feature: | Make-whole call at Treasuries plus 20 bps until Oct. 15, 2046, then a par call
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| Price guidance: | Treasuries plus 112.5 bps area, plus or minus 2.5 bps
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