Municipals take a tumble as pricing action starts; Grossmont Health Care sells $226.85 million

By Sheri Kasprzak

New York, April 28 – Municipal prices rose on the session Tuesday with yields on the long end rising by as much as 5 basis points, traders said in the afternoon.

The 30-year bond yield rose by about 2 bps to 3.01%.

One sellsider said Tuesday afternoon that a heavy corporate calendar may have negatively impacted the muni market.

Weaker Treasuries also impacted the market as the 30-year Treasury yield rose by 7 bps and the 10-year yield climbed 6 bps.

Grossmont leads deals

Heading up the primary action for Tuesday, Grossmont Health Care District of California brought $226.85 million of series 2015 general obligation bonds, the largest negotiated sale of the day and one of several health-care offerings to price recently.

The bonds (Aa2) were sold through Goldman Sachs & Co.

The offering included $24.51 million of election of 2006 series 2015C G.O. bonds and $202.34 million of series 2015D G.O. refunding bonds, said a pricing sheet.

The 2015C bonds are due 2019 to 2027 with 5% coupons.

The 2015D bonds are due 2016 to 2035 with a term bond due in 2040. The serial coupons range from 2% to 5%. The 2040 bonds have a 4% coupon and priced at 102.09.

Proceeds will be used to finance capital projects and to refund the district’s series 2007A and 2011B G.O. bonds.

Tallahassee health bonds price

Elsewhere in the sector, Tallahassee, Fla., offered $106.82 million of series 2015A health facilities revenue refunding bonds for Tallahassee Memorial Healthcare Inc.

The bonds (Baa1) were sold through BofA Merrill Lynch.

The bonds are due in 2035, 2040 and 2044, according to a term sheet. The 2035 bonds have a 4% coupon and priced at 97.268, the 2040 bonds have a 5% coupon and priced at 107.072, and the 2044 bonds have a 5% coupon and priced at 106.566.

Proceeds will be used to refund the health-care system’s series 1992B and 2000 health-care facilities revenue bonds.

Palm Beach prices deal

Leading the day’s competitive action, Palm Beach County, Fla., brought to market $63,155,000 of series 2015A public improvement revenue bonds.

The bonds (Aa1/AA+/AA+) were sold competitively. Robert W. Baird & Co. won the bid at a 3.131% true interest cost, said Sherry Brown, assistant budget director for the county.

The bonds are due 2016 to 2035 with 2% to 4% coupons and 0.54% to 3.50% yields.

“The county is not required to sell competitively but did so on this deal for favorable market conditions,” Brown said in an interview Tuesday.

Proceeds will be used to construct a 2,600-space parking garage adjacent to the county’s convention center and to renovate and improve county buildings.

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