By Andrea Heisinger
New York, Oct. 20 - UnitedHealth Group Inc. sold $750 million of senior notes (Baa1/A-/A-) in two tranches by mid-afternoon on Wednesday, a source who worked on the deal said.
A $450 million tranche of 3.875% 10-year notes priced at 99.665 to yield 3.916% with a spread of 145 basis points over Treasuries. This was in line with whispered guidance in the mid-100 bps area and at the tight end of revised guidance in the 150 bps area, plus or minus 5 bps.
The 10-year notes have a make-whole call of Treasuries plus 25 bps until July 15, 2020 and are then callable at par.
A $300 million tranche of 5.7% 30-year bonds sold at 99.362 to yield 5.745% with a spread of Treasuries plus 185 bps. The notes also priced in line with whispered talk in the high 100 bps area and at the tight end of guidance in the 190 bps area, plus or minus 5 bps.
The 30-year bonds are callable at a make-whole of 30 bps over Treasuries up to April 15, 2040 and then are callable at par.
Bookrunners were Bank of America Merrill Lynch, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC.
Barclays Capital Inc., BB&T Capital Markets, BNY Mellon Capital Markets LLC, Credit Suisse Securities (USA) LLC, Goldman Sachs & Co., Morgan Stanley & Co. Inc., RBS Securities Inc., U.S. Bancorp Investments, UBS Securities LLC and Wells Fargo Securities LLC were the co-managers.
Proceeds are being added to the company's general funds.
The health benefits provider is based in Minnetonka, Minn.
| Issuer: | UnitedHealth Group Inc.
|
| Issue: | Senior notes
|
| Amount: | $750 million
|
| Bookrunners: | Bank of America Merrill Lynch, Citigroup Global Markets Inc., J.P. Morgan Securities LLC
|
| Co-managers: | Barclays Capital Inc., BB&T Capital Markets, BNY Mellon Capital Markets LLC, Credit Suisse Securities (USA) LLC, Goldman Sachs & Co., Morgan Stanley & Co. Inc., RBS Securities Inc., U.S. Bancorp Investments, UBS Securities LLC, Wells Fargo Securities LLC
|
| Change-of-control put: | 101%
|
| Trade date: | Oct. 20
|
| Settlement date: | Oct. 25
|
| Ratings: | Moody's: Baa1
|
| Standard & Poor's: A-
|
| Fitch: A-
|
|
|
| 10-year notes
|
| Amount: | $450 million
|
| Maturity: | Oct. 15, 2020
|
| Coupon: | 3.875%
|
| Price: | 99.665
|
| Yield: | 3.916%
|
| Spread: | Treasuries plus 145 bps
|
| Call: | Make-whole at Treasuries plus 25 bps until July 15, 2020, then at par
|
| Price talk: | Mid-100 bps (whispered), 150 bps area, plus or minus 5 bps
|
|
|
| 30-year bonds
|
| Amount: | $300 million
|
| Maturity: | Oct. 15, 2040
|
| Coupon: | 5.7%
|
| Price: | 99.362
|
| Yield: | 5.745%
|
| Spread: | Treasuries plus 185 bps
|
| Call: | Make-whole at Treasuries plus 30 bps until April 15, 2040, then at par
|
| Price talk: | High 100 bps (whispered), 190 bps area, plus or minus 5 bps
|
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