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US Leveraged Finance Issuance Soars To $27B, The Most Since November

U.S. leveraged finance issuance shot to $26.9 billion last week as loan investors continue to throw money at larger deals in anticipation of a dwindling slate of new credits down the road, and as high yield bond issuers worked to wrap offerings ahead of Memorial Day.

US leveraged finance issuance

The weekly total is the most for the combined capital markets segments since the $31.6 billion in early November, according to LCD, an offering of S&P Global Market Intelligence.

In all there was $15.1 billion of new leveraged loans last week, following up on the $16.8 billion the previous week.

“You don’t have to look far to see what’s driving the market forward,” said LCD’s Chris Donnelly, in his weekly market analysis. “The visible institutional loan calendar fell last week … and the larger deals now in market will soon cycle off the calendar.”

Loans of note last week include Dell’s $5 billion credit backing its acquisition of EMC, $2.1 billion of new debt supporting a refinancing by supermarket chain Albertsons, and $1.5 billion of new institutional debt backing a recap by restaurant chain Yum! Brands.

High yield bond issuance last week totaled a hefty $11.8 billion, according to LCD.

“Firm market conditions allowed for a seasonal rush to market ahead of the long weekend,” wrote LCD’s Matthew Fuller. “Even with the $525 million offering from airline wi-fi provider Gogo put on ice … the 17 credits over 20 tranches is the largest one-week sum this year.”

Gogo scrapped its issue – which had been completed, though not settled – after the company “received a proposal from a major airline customer under which Gogo would provide connectivity service on a meaningful portion of the airline’s domestic fleet.”

Also of note in high yield last week, Albertsons wrapped a $1.25 billion offering, alongside its loan, and private equity shop Hellman & Friedman completed a $1.1 billion deal backing the LBO of management consulting services co. Multiplan. - Tim Cross

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This story first appeared on www.lcdcomps.com, LCD’s subscription site offering complete news, analysis and data covering the global leveraged loan and high yield bond markets. You can learn more about LCD here.

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