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US IG CLOSE-Four high-grade issuers raise US$5.25bn
By Mike Gambale
NEW YORK, Oct (HKSE: 3366-OL.HK - news) 6 (IFR) - Below is a recap of primary issuance activity in the US high-grade market on Tuesday:
Number of deals priced: 4
Total (Swiss: FP.SW - news) issuance volume: US$5.25bn
Total book to cover: 3.14
Average NIC: 7
ROYAL BANK OF CANADA (LSE: 0QKU.L - news)
Royal Bank of Canada (RY), Aaa/AAA/AAA, announced a US$ benchmark SEC registered 5-year (10/14/2020) fixed covered bond. The active bookrunners include Citigroup (NYSE: C - news) , HSBC, Royal Bank of Canada and TD Securities. Guarantor: RBC Covered Bond Guarantor Limited Partnership. Settle: 10/14/2015.
IPT: MS+75bp area
PRICE GUIDANCE: MS+72bp (the #)
LAUNCH: US$1.75bn at MS+72bp
PRICED: US$1.75bn. Cpn 2.100%. Due 10/14/2020. Ip US$99.967. Yld 2.107%. MS+72bp (T+77.85bp).
BOOK: Just over US$2bn
NIC (NasdaqGS: EGOV - news) : 6bp (vs. 1.875% '20s at MS+61bp, add 5bp for maturity extension, FV=MS+66bp)
COMPS:
2.000% October 1, 2018 at MS+55bp (bid)
1.875% February 5, 2020 at MS+61bp (bid)
ROLLS ROYCE (LSE: RR.L - news)
Rolls-Royce PLC, A3/A, announced a US$ benchmark 144A/RegS 2-part senior unsecured note offering that includes a 5-year (10/14/2020) and 10-year (10/14/2025). The active bookrunners include Bank of America (Swiss: BAC.SW - news) , Citigroup, Goldman Sachs (NYSE: GS-PB - news) and JPMorgan.
The notes include a 1mo par call on the 5yr and 3mo par call on the 10yr. Ranking: Guaranteed by Rolls-Royce Holdings plc. Settle: T+5 (October 14th, 2015). UOP: GCP and to increase liquidity.
IPTs: 5-year T+137.5bp area, 10-year T+187.5bp area
PRICE GUIDANCE: 5yr T+110bp area, 10yr T+165bp area. Area is +/- 5bp.
LAUNCH: US$1.5bn 2-part. US$500m 5yr at T+105bp, US$1bn 10yr at T+160bp.
PRICED: US$1.5bn 2-part. Settlement date 10/14/2015.
- US$500m. Cpn 2.375%. Due 10/14/2020 Ip US$99.948. Yld 2.836%. T+105bp. MWC T+20bp.
- US$1bn. Cpn 3.625%. Due 10/14/2025. Ip US$99.900. Yld 3.637%. T+160bp. MWC T+25bp.
BOOK: Total US$7.8bn; 5-year US$3.1bn, 10-year US$4.7bn
NIC: 5-year: Flat (5/10s curve worth 55bp, FV=G+105bp)
10-year: Flat (vs. SIEGR 3.25% '25s at G+117bp, add 8bp for one-notch rating differential, FV=G+125bp. Add 35bp for market cap differential, FV=G+160bp)
MARKET CAP: Rolls Royce US$13.12bn, Siemens US$70.78bn
COMPS:
SIEGR (A1/A+) 2.150% May 27, 2020 at G+81bp
SIEGR (A1/A+) 3.250% May 27, 2025 at G+117bp
LMT (Baa1/A-/A-) 2.900% March 1, 2025 at G+127
AIRFP A2/A/A-) 2.700% April (LSE: 0N69.L - news) 17, 2023 at G+135bp
BALN (Baa2/BBB+/BBB+) 3.800% October 7, 2024 at G+164bp
NORILSK NICKEL
Norilsk Nickel, (Ba1/BBB-/BBB-), announced a US$ benchmark 7-year (10/14/2022) senior unsecured loan participation notes via Barclays (LSE: BARC.L - news) , Citigroup, ING, SocGen (Paris: FR0000130809 - news) and Unicredit (EUREX: DE000A163206.EX - news) . Settlement date 10/14/2015.
IPT: 7% area
FINAL GUIDANCE: 6.75% (+/-12.5bp) for a US dollar seven-year bond.
LAUNCH: US$1bn 7-year at 6.625%.
PRICED: US$1bn. Cpn 6.625%. Due 10/14/2022. Ip par. Yld 6.625%. T+488.9bp.
BOOK: US$4bn
NIC: 22bp (vs. 5.550% '20s at yield of 5.6%, add 80bp for maturity extension, FV=6.40%)
5.550% October 28, 2020 at yield of 5.60% (Z+425bp)
BANCOMEXT
Mexico's state-owned trade bank Bancomext, A3/BBB+, is out with a new US$ benchmark 10-year senior unsecured bond. Bank of America Merrill Lynch and HSBC are acting as leads on the 144A/RegS transaction. The notes contain a MWC. UOP: General business purposes, including for asset and liability management purpose.
IPT: T+250bp area
PRICE GUIDANCE: T+250bp area (+/- 12.5bp)
LAUNCH: US$1bn 10-year at T+237.5bp.
PRICED: US$1bn 10-yr: 99.719; 4.375%C; 4.41%Y; T+237.5bp; Settlement: Oct 14 2015; Maturity: Oct 14 2025
BOOK: US$2.7bn (Reporting By Michael Gambale; editing by Shankar Ramakrishnan)
