Caterpillar, Total System, United, Hope tap primary; high-grade credit spreads tighten

By Cristal Cody

Tupelo, Miss., May 9 – High-grade deal action included a $2 billion four-tranche offering of notes from Caterpillar Financial Services Corp. on Wednesday.

Total System Services, Inc. also priced a $1 billion two-part offering of senior notes.

In addition, United Airlines, Inc. sold $225.73 million of class B pass-through certificates.

In other investment-grade supply expected during the session, the City of Hope (A1/A+/AA-) of California also planned to price a 30-year bullet bond.

More than $23 billion of high-grade bonds have priced week to date, market sources report.

Syndicate sources expect about $30 billion to $35 billion of supply for the week.

The Markit CDX North American Investment Grade 30 index tightened more than 1 basis point to close at a spread of 62 bps.

In the secondary market, new issues were mixed but mostly trading slightly better than issuance, according to market sources earlier in the day.

Kellogg Co.’s $1 billion of senior notes (Baa2/BBB/) priced in two tranches on Monday were flat to about 3 bps tighter on the short end.

Consolidated Edison Co. of New York, Inc.’s $1 billion of debentures (A2/A-/A-) also priced Monday in two parts firmed about 4 bps in secondary trading.

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