Published on 11/13/2017 in the Prospect News Investment Grade Daily.
New Issue: UPS prices $5.2 billion of seven-tranche floating-, fixed-rate notes
By Devika Patel
Knoxville, Tenn., Nov. 13 – United Parcel Service, Inc. priced $5.2 billion of notes (A1/A+/) in seven parts on Nov. 9, according to an FWP filing with the Securities and Exchange Commission.
There were floating-rate senior notes in two tranches and fixed-rate notes in five tranches.
The company sold $350 million of four-year floaters at Libor plus 15 basis points with a price of par.
UPS priced $500 million of six-year floaters at Libor plus 45 bps with a price of par.
The company issued $700 million of 2.05% four-year notes at a spread of Treasuries plus 35 bps. These notes priced at 99.842 to yield 2.099%
There was $1 billion of 2.5% six-year notes at a spread of Treasuries plus 55 bps. These notes priced at 99.692 to yield 2.562%
The company priced $500 million of 2.8% seven-year notes at a spread of Treasuries plus 65 bps. These notes priced at 99.647 to yield 2.856%
UPS issued $1 billion of 3.05% 10-year notes at a spread of Treasuries plus 75 bps. These notes priced at 99.564 to yield 3.101%
There were $1.15 billion of 3.75% 30-year notes at a spread of Treasuries plus 95 bps. These notes priced at 99.749 to yield 3.764%
Barclays, Goldman Sachs & Co., J.P. Morgan Securities LLC, SG Americas Securities LLC, Wells Fargo Securities LLC, BNP Paribas Securities Corp., Citigroup Global Markets Inc., BofA Merrill Lynch, Mizuho Securities USA Inc., Morgan Stanley & Co. LLC and UBS Securities LLC are the bookrunners.
The package delivery and supply chain management company is based in Atlanta.
| Issuer: | United Parcel Service, Inc.
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| Amount: | $5.2 billion
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| Description: | Floating-rate senior notes, fixed-rate notes
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| Bookrunners: | Barclays, Goldman Sachs & Co., J.P. Morgan Securities LLC, SG Americas Securities LLC, Wells Fargo Securities LLC, BNP Paribas Securities Corp., Citigroup Global Markets Inc., BofA Merrill Lynch, Mizuho Securities USA Inc., Morgan Stanley & Co. LLC and UBS Securities LLC
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| Co-managers: | BNY Capital Markets Inc., CastleOak Securities LP, Commerzbank Capital Markets Corp., Fifth Third Securities Inc., HSBC Securities (USA) Inc., Lloyds Securities Inc., MUFG, Standard Chartered Bank, Williams Capital Group LP and U.S. Bancorp Investments Inc.
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| Trade date: | Nov. 9
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| Settlement date: | Nov. 14
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| Ratings: | Moody’s: A1
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| S&P: A+
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| Four-year floaters
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| Amount: | $350 million
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| Maturity: | April 1, 2021
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| Coupon: | Libor plus 15 bps
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| Price: | Par
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| Call features: | Non-callable
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| Six-year floaters
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| Amount: | $500 million
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| Maturity: | April 1, 2023
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| Coupon: | Libor plus 45 bps
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| Price: | Par
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| Call features: | Non-callable
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| Four-year notes
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| Amount: | $700 million
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| Description: | Fixed-rate notes
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| Maturity: | April 1, 2021
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| Coupon: | 2.05%
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| Price: | 99.842
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| Yield: | 2.099%
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| Spread: | Treasuries plus 35 bps
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| Call feature: | Greater of a make-whole call at Treasuries plus 10 bps and a par call until April 1, 2021
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| Six-year notes
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| Amount: | $1 billion
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| Description: | Fixed-rate notes
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| Maturity: | April 1, 2023
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| Coupon: | 2.5%
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| Price: | 99.692
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| Yield: | 2.562%
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| Spread: | Treasuries plus 55 bps
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| Call feature: | Make-whole call at Treasuries plus 10 bps until March 1, 2023, then a par call
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| Seven-year notes
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| Amount: | $500 million
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| Description: | Fixed-rate notes
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| Maturity: | Nov. 15, 2024
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| Coupon: | 2.8%
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| Price: | 99.647
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| Yield: | 2.856%
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| Spread: | Treasuries plus 65 bps
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| Call feature: | Make-whole call at Treasuries plus 10 bps until Sept. 15, 2024, then a par call
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| Ten-year notes
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| Amount: | $1 billion
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| Description: | Fixed-rate notes
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| Maturity: | Nov. 15, 2027
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| Coupon: | 3.05%
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| Price: | 99.564
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| Yield: | 3.101%
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| Spread: | Treasuries plus 75 bps
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| Call feature: | Make-whole call at Treasuries plus 15 bps until Aug. 15, 2027, then a par call
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| 30-year notes
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| Amount: | $1.15 billion
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| Description: | Fixed-rate notes
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| Maturity: | Nov. 15, 2047
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| Coupon: | 3.75%
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| Price: | 99.749
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| Yield: | 3.764%
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| Spread: | Treasuries plus 95 bps
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| Call feature: | Make-whole call at Treasuries plus 15 bps until May 15, 2047, then a par call
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