By Aleesia Forni
Virginia Beach, May 19 – Columbia Pipeline Group Inc. sold $2.75 billion of senior notes (Baa2/BBB-/BBB-) on Tuesday in four tranches, according to a market source.
The issuer brought to market $500 million of 2.45% three-year notes with a spread of Treasuries plus 145 basis points. Pricing was at 99.976 to yield 2.458%.
There was a $750 million tranche of 3.3% five-year notes priced at 99.82 to yield 3.339%, or Treasuries plus 175 bps.
Also priced was $1 billion of 4.5% 10-year notes with a spread of 225 bps over Treasuries. The issue sold at 99.847 to yield 4.519%.
Finally, $500 million of 5.8% notes due 2045 sold at 99.772 to yield 5.816%, or Treasuries plus 275 bps.
All four tranches sold at the tight end of guidance.
The notes were offered via Rule 144A and Regulation S.
Proceeds will be used to pay off $1,025,200,000 of intercompany debt between Columbia Pipeline and its wholly owned subsidiary, NiSource Inc., and to fund a $1.45 billion special dividend to NiSource in connection with its separation from the company. Any remaining proceeds will be used for general corporate purposes.
J.P. Morgan Securities LLC, MUFG and Scotia Capital (USA) Inc. are the active bookrunners. Passive bookrunners are Credit Suisse Securities, Mizuho Securities and RBC Capital Markets LLC.
The notes will be guaranteed by the company’s subsidiaries.
The Houston-based company owns and operates natural gas pipelines.
| Issuer: | Columbia Pipeline Group Inc.
|
| Issue: | Senior notes
|
| Amount: | $2.75 billion
|
| Bookrunners: | J.P. Morgan Securities LLC, MUFG, Scotia Capital (USA) Inc., Credit Suisse Securities, Mizuho Securities, RBC Capital Markets LLC
|
| Trade date: | May 19
|
| Settlement date: | May 22
|
| Ratings: | Moody’s: Baa2
|
| Standard & Poor’s: BBB-
|
| Fitch: BBB-
|
| Distribution: | Rule 144A, Regulation S without registration rights
|
|
|
| Three-year notes
|
| Amount: | $500 million
|
| Maturity: | June 1, 2018
|
| Coupon: | 2.45%
|
| Price: | 99.976
|
| Yield: | 2.458%
|
| Spread: | Treasuries plus 145 bps
|
| Price guidance: | Treasuries plus 150 bps area (+/- 5 bps)
|
| Make-whole call: | Treasuries plus 25 bps
|
|
|
| Five-year notes
|
| Amount: | $750 million
|
| Maturity: | June 1, 2020
|
| Coupon: | 3.3%
|
| Price: | 99.82
|
| Yield: | 3.339%
|
| Spread: | Treasuries plus 175 bps
|
| Price guidance: | Treasuries plus 187.5 bps area (+/- 12.5 bps)
|
| Make-whole call: | Treasuries plus 30 bps
|
|
|
| 10-year notes
|
| Amount: | $1 billion
|
| Maturity: | June 1, 2025
|
| Coupon: | 4.5%
|
| Price: | 99.847
|
| Yield: | 4.519%
|
| Spread: | Treasuries plus 225 bps
|
| Price guidance: | Treasuries plus 237.5 bps area (+/- 12.5 bps)
|
| Make-whole call: | Treasuries plus 35 bps
|
|
|
| 30-year bonds
|
| Amount: | $500 million
|
| Maturity: | June 1, 2045
|
| Coupon: | 5.8%
|
| Price: | 99.772
|
| Yield: | 5.816%
|
| Spread: | Treasuries plus 275 bps
|
| Price guidance: | Treasuries plus 287.5 bps area (+/- 12.5 bps)
|
| Make-whole call: | Treasuries plus 45 bps
|
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