Leveraged finance issuance in the U.S. is continuing its post-Labor Day surge with a substantial $28.4 billion in combined loan and high yield bond issuance last week, up from the already healthy $25.6 billion the previous week, according to LCD, an offering of S&P Global Market Intelligence.
Loans once again led the way, with $19.5 billion of new issuance via a whopping 38 deals, as investors remain hungry for paper.
“Arrangers continued to roll out new transactions into a market brimming with a mix of M&A, refinancing, and recap deals,” writes LCD’s Jon Hemingway, who covers the leveraged loan segment. “And the next two weeks should be busy as investors sort through this new business.”
Those M&A deals made some of the biggest splashes in market. Nexstar Broadcasting last week unveiled a $2.85 billion term loan to help finance the company’s $4.6 billion acquisition of Media General. Also, Inventive Health launched to syndication a $1.68 billion institutional loan backing the purchase of an equity stake in the company by PE concern Advent International.
Issuance in the high yield bond segment of the leveraged finance space totaled $8.9 billion last week, up slightly from the previous week. Many of those deals refinanced debt, though there was M&A as well, including a $500 million issue backing Onex Corp.’s LBO of Thomson Reuters IP&S (Camelot) and a $400 million deal backing PDC Energy’s acquisition of Kimmeridge Energy assets. As well, Dutch internet concern Ziggo priced $2.65 billion of notes as part of a cross-border offering backing a recapitalization and dividend.
While issuance continued, high yield investors appeared to take a broader step backward last week, withdrawing a hefty $2.45 billion from the asset class, according to Lipper.
This story first appeared on www.lcdcomps.com, an offering of S&P Global Market Intelligence. LCD’s subscription site offers complete news, analysis and data covering the global leveraged loan and high yield bond markets. You can learn more about LCD here.