In the latest installment of The Bond Buyer’s Muni Minute, we look at how the state of California is marketing its latest taxable bond sale to buyers around the world. The $1 billion-plus of fixed-rated, mandatory put and floating-rate notes are designed to appeal to a broad swath of international investors.
VOICE OVER: Investors around the world will be singing, "California, Here We Come" as the Golden State prepares to sell over $1 billion of taxable bonds this week to help fund its $64 billion high-speed rail project. The bonds are being marketed to international as well as domestic institutional buyers by joint lead managers JP Morgan and Bank of America Merrill Lynch. "The fixed-rated, mandatory put and floating-rate notes offered in three series are designed to appeal to a broad swath of investors," Deputy Treasurer Tim Schaefer said.
International investors like floating-rate notes, because of the yields and flexibility on duration. California has been a frequent seller this year, but that isn't expected to dampen demand. It has already issued $2.8 billion in GOs and $534 million of public works bonds and competitively sold $604 million of GO refunding bonds. "California has a positive credit story to tell," Schaefer said.
Lawmakers have okayed budgets on time, voters have approved tax extensions and the governor has shown prudence in setting reasonable spending goals. I'm Chip Barnett, and this has been your Muni minute.