July 22, 2014 – Steel Dynamics, one of the nations largest steel producers, plans on issuing new debt to help finance an announced $1.63 billion acquisition of a steel plant from Severstal OAO.
July 22, 2014 – Regency Energy Partners is selling $500 million in senior notes due 2022. The Dallas-based natural gas provider plans to use the proceeds to repay outstanding revolver debt.
July 22, 2014 – CITGO Petroleum is close to pricing its $2.3 billion in loans and bonds to refinance is existing senior credit facility and pay for a $300 million dividend.
July 22, 2014 – In a reversal from first-quarter trends, Babson Capital reports that spreads tightened slightly in both the U.S. and Europe for AAA paper in CLO 2.0 issues while lower-rated mezzanine tranches saw widening spreads of 20 bps.
July 18, 2014 – Zebra Technologies agreed to purchase the enterprise business of Motorola Solutions, which had sales of $2.5 billion in 2013, for $3.45 billion in an all-cash transaction. Motorola's enterprise sales are more than twice those of Zebra.
July 16, 2014 – A record rise in the number of first-time, single B-rated issuers has Standard & Poors concerned that a greater number of companies will be at risk of default in the event of a slowdown in the U.S. economy
July 11, 2014 – Just when you thought that risky corporate borrowers were getting away with everything, investors are demonstrating that have at least a little fight left in them. High yield bonds are in such high demand that investors have been willing to give up all kinds of protection in order to put their money to work. But non-call periods are a line in the sand.
July 11, 2014 – Moodys Investors Service downgraded its outlook on regional casino operators, to negative from stable after 15 of 18 states reported declining year-over-year gaming revenues for consecutive months. The weaker-than-expected results were surprising.
July 10, 2014 – Verso Paper is making another go of an exchange offer it needs to complete before it can close its acquisition of NewPage Holdings. A similar exchange offer earlier this year failed to get enough support from bondholders.
July 3, 2014 – Analysts believe the former junk bond record-holder is getting ready to put a lot more debt on the market in its efforts to secure a $32 billion merger with T-Mobile.
July 3, 2014 – Corporations are flush with cash and debt markets are eager to provide additional capital for acquisitions. That makes it increasingly easy for borrowers to negotiate favorable terms, according to William Schwitter and Michael Chernick, both partners with the law firm of Paul Hastings.
July 3, 2014 – CLO managers have been lobbying hard to shape rules requiring them to keep skin in the game. Now they are getting support from an unlikely source European central bankers.
June 27, 2014 – Corporate borrowers were still in the drivers seat in the first half, even if they didnt raise as much money in the high yield bond and leveraged loan markets as they did a year earlier. With demand strong and defaults low, participants expect to see the same pace in the second half, driven by a similar mix of refinancing, strategic acquisitions and leveraged buyouts.
June 27, 2014 – Language Line, which recently pulled its $785 million loan proposal from the market, faces a round of near-term debt obstacles that have raised red flags and downgrades from ratings agencies. Of primary concern are a series of upcoming leverage ratio step-down covenants on its existing debt the agencies believe will be problematic without refinancing or term changes from lenders.
June 27, 2014 – Monroe Capital is suing a former managing director and fund partner, alleging he is tried to take clients for a new firm while he was still employed by Monroe. Monroe said in a complaint that Warren Woo accessed information at Monroe that was beyond his authorization and transferred this data to his new firm via emails.
June 25, 2014 – The Office of the Comptroller of the Currency sounded the alarm again Wednesday about two key areas in which it sees heightened risks from expanding portfolios: indirect auto lending and leveraged lending.
June 20, 2014 – Europes junk bond market may be red hot, but it has not been attracting many non-Europeans lately. And this pace is being sustained despite a slowdown in buyouts of multinational companies by private equity firms, an important driver of 2013 volume. Still, issuance of European high yield bonds is on pace to reach an all-time high this year.
June 20, 2014 – Newspaper ad spending and circulation are on a permanent decline, and publications are a shrinking slice of revenue for media conglomerates - which is why Tribune Publishing is being spun off from Tribune Co. But according to Moody's, the new Tribune newspaper company and other spinoffs may find they can better invest in their own growth as independent firms, aided by loan market investors who have not shied away from newspaper groups.
June 19, 2014 – When it comes to buyouts, bigger is not necessarily better. Moodys Investors Service posits that, while companies taken private before the credit crisis are no more likely to default than other below-investment grade companies, the biggest buyouts have fared much worse.
June 13, 2014 – A ruling that blocked hedge funds from voting in a bankrupt shopping center's reorganization plan in Washington state has spread like brush fire in legal and investor circles, with worries about the potential precedence it might set for holders of distressed debt in Chapter 11 plans.
June 13, 2014 – Regulators might have a problem with highly leveraged buyouts, but investors dont. They are embracing the Blackstone Groups buyout of industrial products maker Gates Global despite the fact that the deals leverage exceeds lending guidance.
June 13, 2014 – Chesapeake Energys spinoff of its oilfield operations will streamline the Oklahoma City-based natural gas provider and relieve it of $1 billion in debt. But investors had better hope that the new company continues to do the same amount of business with its former parent or quickly diversifies its customer base.
June 6, 2014 – Institutional investors are increasingly accessing the junk bond market indirectly, via exchange traded funds, as opposed to buying and selling the bonds themselves.This increases the potential for ETFs, which are baskets of securities that trade on an exchange, like stocks, to influence the pricing of junk bonds.
June 6, 2014 – Recent reports from analysts at Deutsche Bank and Keefe, Bruyette & Woods - as well as comments from a top Fed supervisory official last month - raised doubts that leveraged lending guidance has yet to have on impact on bank lending practices. But not all agree, noting that aggregate deal data does not reflect trends toward lower deal sizes, more upfront borrower equity and a growing number of loan denials all due to regulatory concerns.
June 5, 2014 – Bonds of various entities of Caesars Entertainment Group (CEC) continue to be among the most actively traded bonds on the high yield market and are among the bond taking the biggest losses. They have continued to lose ground in the wake of a company downgrade and months-long struggle over the position of its assets.
May 30, 2014 – RadioShack, fresh off a Super Bowl ad that poked fun at its obsolete reputation, had plans to close 1,100 of its lower-performing stores this year. But the company's lenders balked at the strategyand have thrown in serious doubt the retailers chances of fixing its business model, much less its old dowdy look.
May 29, 2014 – Small banks are breaking out of their comfort zone and establishing new business lines with a little bit of help from the Small Business Administration. More community banks are offering SBA loans far beyond their local markets.
May 28, 2014 – The LBO default cycle is ticking up even without the big push from the former TXU, though many private equity-backed companies will continue to win reprieves thanks to yield-hungry investors willing to help refinance debt for the time being.
May 23, 2014 – Two years ago, the U.S. Supreme Court seemingly affirmed the right of secured debtholders to use a lien on a borrowers assets as currency in 363 corporate bankruptcy sales. Now, legal experts arent so sureand believe that federal judges may again be calling into question the right of a lender or a secondary creditor to bid the full value of their claims in Chapter 11 cases.
May 22, 2014 – Until recently, junk bonds have had trouble competing with loans because investors feared that rising interest rates would make bonds fixed interest rates less attractive. So many borrowers in both the U.S. and Europe have instead been offering bonds with rates that are pegged to Libor or Euribor, just like leveraged loans.
May 22, 2014 – The leveraged loan and junk bond markets may not be as hot as last year, but a single-B company can still sell billions to put towards multiple dividend payments. TransDigm Group went to the credit markets and raised funds for a payout to shareholders.
May 16, 2014 – Loan fund managers are responding cautiously to the first outflows in years. While few have had to sell holdings to meet redemptions, many are becoming more selective about where they put their money to work, and some are building up their cash reserves. Redemptions have exceeded purchases for four of the past five weeks.
May 16, 2014 – Collateralized loan obligations have two years to become compliant with the Volcker Rule or lose their biggest investors banks -- but some CLO managers arent wasting any time. They are not only divesting any bonds backing these deals, they are also eliminating the ability to invest in bonds in the future.
May 16, 2014 – Downgrades of speculative-grade companies were on the rise in the first quarter of 2014and despite concerns about unrewarded risk that investors are undertaking, there seem to be few concerns the trend is steering the market toward greater default risk.