uploads///Total IG Bond Issuance in WE Mar

Citigroup and Sysco Led High-Grade Bond Issuance Last Week

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Mar. 30 2016, Published 7:24 a.m. ET

Deals overview

US corporates dominated the primary market for high-grade bonds in the week ending March 24, making up 41.7%, or $6.3 billion, of all issues. Yankee issuers made up 21.7% of all issues, while SAS (Sovereigns, Agencies, and Supranationals) issuers made up 20.0% of total issuance. The week brought the year-to-date issuance of high-grade corporate bonds to $439.1 billion.

Citigroup and Sysco Led High-Grade Bond Issuance Last Week

Issuances by high-grade corporates form part of mutual funds like the Hartford Total Return Bond HLS Fund Class IA (HIABX) and the Prudential Total Return Bond Fund Class A (PDBAX).

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Details of Citigroup’s issue

Citigroup (C) is a global investment bank and offers a full range of financial products and services. It issued Baa1/BBB+ rated high-grade bonds worth $2.5 billion via two parts on March 22:

  • $1.0 billion in five-year floating-rate notes issued at three-month LIBOR + 138 basis points
  • $1.5 billion in 2.7% five-year bonds issued at a spread of 133 basis points over similar-maturity Treasuries

Details of Sysco’s issue

Sysco (SYY) markets and distributes food products to restaurants, healthcare and educational facilities, lodging establishments, and other customers. It issued A3/BBB+ rated high-grade bonds worth $2.5 billion via four parts on March 22:

  • $500 million in 1.9% three-year notes issued at a spread of 85 basis points over similar-maturity Treasuries
  • $500 million in 2.5% long five-year notes issued at a spread of 110 basis points over similar-maturity Treasuries
  • $1.0 billion in 3.3% long ten-year notes issued at a spread of 140 basis points over similar-maturity Treasuries
  • $500 million in 4.5% 30-year bonds issued at a spread of 180 basis points over similar-maturity Treasuries
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Details of FedEx’s issue

FedEx (FDX) issued Baa2/BBB rated high-grade bonds worth $2.0 billion via two parts on March 21:

  • $750 million in 3.3% ten-year notes issued at a spread of 135 basis points over similar-maturity Treasuries
  • $1.25 billion in 4.6% 30-year bonds issued at a spread of 185 basis points over similar-maturity Treasuries

Details of Comcast’s issue

Comcast (CMCSA) is a media and technology company with two primary businesses, Comcast Cable and NBCUniversal. It issued A3/A- rated high-grade bonds worth $1.05 billion via two parts on March 22:

  • $350 million in 2.8% seven-year on-tap notes issued at a spread of 75 basis points over similar-maturity Treasuries
  • $700 million in 3.2% ten-year on-tap notes issued at a spread of 90 basis points over similar-maturity Treasuries

In the next article, we’ll look at investment-grade bond fund flows.

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