Morning Commentary: Royalty Pharma, Glencore, Alabama Power, Entergy, Nordea on tap

By Cristal Cody

Tupelo, Miss., Aug. 24 – Numerous issuers offered bonds in the high-grade primary market on Monday in what may be the busiest session of the week, sources reported.

Royalty Pharma plc is on deck with six tranches of dollar-denominated senior notes (Baa3/BBB-/BBB-) in a Rule 144A and Regulation S deal that had attracted $6 billion in orders by early morning.

A tranche of three-year notes has initial price talk at the Treasuries plus 110 basis points area, while a five-year note is talked at the 140 bps spread area.

The company is offering seven-year notes talked at the Treasuries plus 180 bps area, 10-year notes talked at the 205 bps spread area, 20-year notes guided at the 250 bps over Treasuries area and 30-year notes talked at the 265 bps spread area.

Meanwhile, Glencore Funding LLC is offering two tranches of senior notes (Baa1/BBB+), including five-year notes talked to price in the Treasuries plus 175 bps area and 10-year notes talked at the Treasuries plus 215 bps area.

Alabama Power Co. is marketing $500 million of 10-year senior notes (A1/A-/A+) initially guided to price at the 112.5 bps over Treasuries area.

Entergy Corp. also plans to tap the primary market on Monday with five-year senior notes (Baa2/BBB). Initial price talk is in the Treasuries plus 95 bps area.

Nationwide Building Society intends to price five-year senior notes (A1/A/A+) over the day that are talked at the Treasuries plus 95 bps area.

Nordea Bank AB expects to bring a Rule 144A and Regulation S offering of five-year senior notes (Aa3/AA-/AA) to the market on Monday.

The notes are talked to price in the Treasuries plus 80 bps area.

In other supply, PPG Industries, Inc. intends to price an add-on to its 3.75% notes due March 15, 2028 (A3/A-/A-) during the session.

PPG Industries originally sold $700 million of the notes on Feb. 22, 2018 at 99.857 to yield 3.767%, or Treasuries plus 85 bps.

In the meantime, sovereign, supranational and agency supply is in the works for later in the week.

Landwirtschaftliche Rentenbank (Aaa/AAA/AAA) announced a registered offering of 10-year senior notes anticipated to price on Tuesday.

About $15 billion to $20 billion of high-grade deal volume is expected by market participants this week following about $45 billion of corporate and SSA issuance last week.

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