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Leveraged Loan Volume Slides To $5.1B As Issuers, Investors Mull Deals, Changes

Leveraged loan issuance in the U.S. slowed dramatically this week as investors continued to chew over credits already brought to market and issuers tinkered with deals. Volume slid to $5.1 billion via seven new issues, from a healthy $20 billion the previous week, according to S&P Capital IQ/LCD.

With this week’s activity, year to date leveraged loan issuance in the U.S. now totals $451 billion, down from $476 billion during the same period in 2013. For September, loan volume is rebounding to normal levels after a particularly dismal August. Through yesterday there has been $52 billion in U.S. issuance in September,, compared to only $15 billion the previous month (the August number was the lowest since September 2011). 

There was little to choose from this week as far as notable deal launches. Probably the highest-profile issuer was for Metaldyne Performance Group, an automotive concern controlled by private equity concern American Securities Capital. The company this week unveiled $1.5 billion in loans backing a refinancing/IPO. 

More telling: How deals already in market are faring.

“When accounts get comfortable with a story or see an attractive mix of pricing and ratings, they’re still piling into deals, albeit selectively,” says LCD’s Chris Donnelly. For instance, accounts got behind a $6.75 billion institutional tranche backing Burger King’s merger with Tim Hortons after arrangers made some investor-friendly revisions in what remains a choppy leveraged loan mart. 

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