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By Andrea Johnson and Christopher Reich
NEW YORK, Nov 5 (IFR) - Abbott's new pharmaceuticals business AbbVie Inc completed the biggest ever dollar-denominated debt issue in the US high-grade market on Monday, raising $14.7 billion in a six-part deal.
AbbVie, which will house Abbott's
The "old" Abbott will focus on the company's medical devices, diagnostics and nutritional product businesses.
The deal came on a record day for dollar volume, with issuers selling a staggering $22.1 billion of debt on the eve of one of the tightest presidential elections in memory.
"With a deal of this size they could not afford to wait until after the election to get it done," said an investment-grade corporate credit strategist who has covered the Abbott spinoff.
"Whichever way the election goes it will have an effect on spreads, and Abbott couldn't afford to take a punt on the market changing."
Barclays, Bank of America Merrill Lynch, JP Morgan, Morgan Stanley, BNP Paribas and Societe Generale were active bookrunners on the Baa1/A rated deal.
Demand from investors was exceptionally strong, with book size heard as high as $47 billion.
"We're not too surprised to read that demand is high," said Carol Levenson, credit strategist at Gimme Credit.
"This deal was expected and provides a relatively rare opportunity to purchase a triple 'B' big pharma name."
Proceeds of the sale will be used to make a cash distribution to Abbott, as provided by the terms of the separation agreement, pay related fees and expenses, and for general corporate purposes.
Abbott last week said it had commenced a cash tender offering for $7.7 billion in outstanding notes.
The previous record for a pure US dollar-denominated deal was held by two other pharmaceuticals companies, according to Thomson Reuters/IFR data: Roche
The Roche deal included a $3 billion one-year floater, which is too short a maturity to be counted toward the total.
GE Capital is in second position with an $11 billion three-part deal from March 2002, followed by WorldCom's $10.1 billion three-part deal from May 2001.
The AbbVie deal also eclipses the $9.8 billion four-part deal brought by United Technologies in May 2012, which until Monday had been the biggest deal of the year.
AbbVie sold $3.5 billion of three-year fixed-rated notes at Treasuries plus 85 basis points (bp), tighter than its launch price guidance of Treasuries plus 90 basis points area.
It sold $500 million of three-year floating-rate notes at Libor plus 76bp, in line with guidance.
The company also sold $4 billion of five-year notes at Treasuries plus 110bp, $1 billion of six-year notes at Treasuries plus 140bp, $3.1 billion of 10-year notes at Treasuries plus 130bp and $2.6 billion of 30-year notes at Treasuries plus 160bp.
(Reporting By Christopher Reich and Andrea Johnson; Editing by Ciara Linnane and Marc Carnegie)