(Bloomberg) -- United Parcel Service Inc. sold $2.6 billion in high-grade bonds Monday as companies rush to price new debt ahead of the Memorial Day holiday. 

The package delivery company priced notes maturing in 10, 30 and 40 years, according to a person familiar with the matter. The $600 million note of 40-year bonds will yield 1.05 percentage point above Treasuries, said the person, declining to be identified as they’re not authorized to speak about it.

The deal is the shipping giant’s first blue-chip bond offering this year, having last tapped the market in February 2023 with a $2 billion sale. UPS last month reported better-than-expected first-quarter earnings amid the company’s restructuring efforts. Subsequently, Chief Financial Officer Brian Newman said he will leave the company June 1 to focus on his health.

UPS was one of 10 firms that sold a combined $14.5 billion of investment-grade debt, occurring as some 25 companies combined launched deals in the leveraged-loan and high-yield-bond markets Monday. 

“We are likely to maintain our underperform recommendation for now, given the further expected earnings decline in 2Q24 and higher leverage tolerance, in addition to today’s higher-than-expected issuance,” CreditSights analysts Matt Woodruff and Arda Tirnakli wrote in a note. “UPS is our least favorite IG transportation name at the moment as they have recently increased their leverage target by 1.0x to 2.5x.”

Bank of America Corp., BNP Paribas SA, Goldman Sachs Group Inc., Morgan Stanley and JPMorgan Chase & Co. managed UPS’ bond sale, the person said. 

--With assistance from Michael Gambale and Brian Smith.

(Updates figures in the second and fourth paragraphs.)

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