Jefferies said it received excellent demand for the $293.255 million of tobacco settlement pass-through bonds it priced for the New York Counties Tobacco Trust VI.

"There was no reduction in the N.Y. Counties Tobacco Trust VI deal, which was comprised of a $161.15 million in bonds offered to the marketplace and $132.105 million in a bond exchange, with market demand very strong," according to Kym Arnone, Joint-Head of Municipal Finance at Jefferies. "As the first deal to be sold in the tobacco space since the N.Y. NPM [Non-Participation Manufacturer] settlement was entered into in October 2015, this deal broke new ground in achieving ratings that also took into account the new tribal pack adjustment that is unique to N.Y."

She added that market demand for the bonds was quite good.

"The market reception for this transaction was excellent with 41 institutional investors participating," she said. "Initial spreads were extremely tight and were tightened further as a result of strong demand. Demand for the non-rated tranche was also very robust."

The offering included tobacco settlement monies owed to seven New York counties: Broome, Dutchess, Onondaga, Rensselaer, Ulster, Sullivan and Oswego.

The $117.83 million of Series 2016A-2B turbo term bonds were priced as 5s to yield 3.47% in 2045 (an approximate yield to maturity of 4.242%) with a projected average life of 14.14 years and an expected final turbo redemption in 2032; and as 5s to yield 3.73% in 2051 (an approximate yield to maturity of 4.420%) with a projected average life of 17.49 years and an with an expected final turbo redemption in 2035. The 2045 bonds are rated BBB by S&P; the 2051 bonds are not rated.

The $1 million of Series 2016A-2A turbo term bonds were priced at par to yield 2% in 2024 with a projected average life of 1.39 years and an expected turbo redemption in 2018. The bonds are rated A by S&P.

The $20.55 million of Series 2016B bonds were priced to yield from 0.97% with a 3% coupon in 2018 to 2.72% with a 5% coupon in 2031; a 2036 maturity was priced as 5s to yield 3% (an approximate yield to maturity of 3.788%) and a 2041 maturity was priced as 5s to yield 3.13% (an approximate yield to maturity of 4.004%). The 2018-2026 maturities are rated A by S&P, the 2027-2031 and 2036 maturities are rated A-minus by S&P and the 2041 maturity is rated BBB-plus by S&P.

The $22.17 million of Series 2016C turbo term bonds were priced at par to yield 2.45% in 2042 with a projected average life of 3.08 years and an expected final turbo redemption in 2022; as 3 3/4s to yield 3.85% in 2045 with a projected average life of 8.97 years and an expected final turbo redemption in 2028; and as 4s to yield about 4.081% in 2051 with a projected average life of 15.06 years and an expected final turbo redemption in 2034. The 2042 and 2045 maturities are rated BBB by S&P and the 2051 maturity is unrated.

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