Dollar General Secures $12.3B for Family Dollar

Dollar General said the commitments would include cash on its balance sheet, a revolver, a term loan and bonds. The deep-discount retailer did not detail the planned sizes of loans or notes offerings, but reported that the combined firms’ resulting pro forma adjusted leverage would be 5.5x.

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SFX Offers Add-On HY Bonds

– SFX Entertainment is offering add-on 9.625% senior secured second-lien notes due 2019. The live entertainment company is selling the notes in a private offering.

MSX International Completes $255M Loan Package

– According to reports, the final price on a $220 million term loan B and a $35 million revolver for the business process outsourcing firm is Libor plus 500 bps.

Emerging Market Debt Reaches a YTD Record High

– Emerging Markets (EM) Debt Capital Markets (DCM) has reached a year-to-date record high with China taking the lead in new deal flow. Emerging market debt capital issuance reached $836.2 billion year-to-date.

Safe-Guard Allocates $210M Loan

– The final price on the allocation is Libor plus 525 bps, compared to an originally proposed Libor plus 500 bps offer.

  • U.S. “TMT” Cos Exit Ch. 11 with Less Value
  • Moody’s: Earnings, Long-Term Maturities Buoy Liquidity
  • Quicksilver Bonds Lose Ground as Payment Looms
  • EnerSys Adds $300M In Loan Debt
  • HY Trading Volumes Start Decline
  • Sensata Gets $1B Debt Pledge for Schrader Buy
  • Moody’s: No Bear Market for HY Bonds
  • Prestige Flexes Final Terms on $720M Loan
  • New HY Bond Issuance Lowest Since 2011
  • NN Inc. Prices $350M Term Loan
  • More

    Featured Articles

    Why Junk Debt Hasn't Sold Off More

    – Retail investors are fleeing high yield bonds funds at a record pace of $7.1 billion this week, forcing fund managers to tap their cash reserves and sell some of their most liquid holdings to fund redemptions, even if they feel that the correction is a technical one.

    Constellation Delevering With Beer Flows

    – Constellation Brands’ fast growth in the beer business is diversifying what has been a traditional wine and spirits operation–and also leading the way for plans to reduce $6.8 billion in net debt obligations, which include a $990 million term loan repricing that hit the market last week.

    CLO Warehouse Financing Makes a Comeback

    – The entrance of new equity investors, including business development corporations and CLO equity funds, willing to contribute the first-loss piece has led to a return of warehouse bridge funding lines that dried up after the financial crisis.

    Third Exchange is the Charm for Verso

    – Verso Paper pulled off a debt exchange it needs to complete its $1.4 billion merger with NewPage Holdings after sweetening the terms for subordinated bondholders a second time and lowering the percentage of acceptances required.

    Summer Selloff Puts HY Managers On Alert

    – The conflagrations in the Middle East and Eastern Europe have certainly put investors on edge. For the last two weeks, investors have been pulling money from junk bonds at the fastest pace in almost a year. High yield bonds were probably due for a small correction after the strong performance of the first half of the year.

    Credit Managers Maintain Positive Outlook

    – The outlook for credit spreads in the coming three months remains slightly optimistic for high-yield investors, despite expectations of growing corporate defaults, according to the latest quarterly member survey from the International Association of Credit Portfolio Managers.

    CLO Investors Flocking to AAA Paper

    – While the Volcker Rule gets blamed for the sudden lull in CLO issuance in January and February, it’s now getting some credit for helping one aspect of the roaring comeback of collateralized loan obligations: the infusion of new primary investors in AAA tranches.

    Zebra to Swallow $3.45B Elephant

    – 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.

    S&P: Long-Range Risk in Deluge of New ‘B’ Issuers

    – A record rise in the number of first-time, single “B”-rated issuers has Standard & Poor’s concerned that a greater number of companies will be at risk of default in the event of a slowdown in the U.S. economy

    Investors Stand Firm on Non-Call Periods

    – 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.

    Moody’s Turns Negative on Gaming

    – Moody’s 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.

    Verso Sweetens Exchange Offer

    – 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.

    Sprint May Be Phoning the Debt Markets Soon

    – 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.

    Precedent Set Quickly in Hot M&A Market

    – 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.

    The Unlikely Champions of "Qualified" CLO: European Central Bankers

    – 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.

    Leveraged Finance Markets a ‘Macro Game’

    – Corporate borrowers were still in the driver’s seat in the first half, even if they didn’t 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.

    Interpreter Service Treads Thin Line

    – 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.

    Monroe Capital Suing Former Partner

    – 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.

    OCC Shines Light on Auto, Leveraged Loan Risks

    – 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.

    In Hot Euro HY Market, Non-European Issuers Rare

    – Europe’s 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.

    Freedom May Be What Tribune Needs

    – 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.

    Mega Deals Up Defaults for LBO Firms

    – When it comes to buyouts, bigger is not necessarily better. Moody’s 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.

    More Bankruptcy Hurdles for Hedge Funds

    – 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.

    Investors Embrace Gates Buyout

    – Regulators might have a problem with highly leveraged buyouts, but investors don’t. They are embracing the Blackstone Group’s buyout of industrial products maker Gates Global despite the fact that the deal’s leverage exceeds lending guidance.

    Chesapeake Oilfield Goes It Alone

    – Chesapeake Energy’s 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.

    Institutionalized: High Yield ETFs Fill Trading Gap

    – 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.

    Lending Guidance’s Hidden Impact?

    – 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.

    Caesars Bonds Continue to Lose Ground

    – 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.

    Lender Impasse Blocking RadioShack's Makeover

    – 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 strategy—and have thrown in serious doubt the retailer’s chances of fixing its business model, much less its old dowdy look.

    More SBA Lending Brings Profit and Risk

    – 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.


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Firm: Wells Capital Management

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