High-Yield Investors Flock To Safety

The European high-yield market got a respite from risky pay-in-kind deals last week, with senior secured notes in demand in Swiss cable operator Cablecom's 1.275 billion Swiss franc ($1.06 billion) deal.

  • 25 Mar 2005
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The European high-yield market got a respite from risky pay-in-kind deals last week, with senior secured notes in demand in Swiss cable operator Cablecom's 1.275 billion Swiss franc ($1.06 billion) deal. Demand for the higher-quality deal came after a recent upswing in market volatility brought on by General Motor's earnings warning and an interest rate rise in the U.S. Goldman Sachs, Deutsche Bank and Credit Suisse First Boston underwrote the offering.

"This is the lowest risk deal we've seen this year from a structural perspective," said one London-based portfolio manager. "It's at the top of the capital structure for a change, right the other end of the spectrum from the PIK notes we've been seeing so much of lately." Of the 30 or so high-yield deals that have been completed in Europe year-to-date, about a quarter have been PIKs.

Cablecom's high-yield offering refinances all of the company's bank debt. "This is the first time a company that is performing well has refinanced bank debt with high-yield; typically that happens when a company is doing poorly and the bank wants out," said an official at Deutsche Bank. "The Cablecom deal appeals to long-only investors who want a bank-debt-like asset but cannot buy loans," observed one high-yield manager in London who did not participate in the deal because of the low yield. "4 1/2% yield--where does that get us?" he asked.

  • 25 Mar 2005

All International Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Citi 352,540.12 1323 9.09%
2 Bank of America Merrill Lynch 315,574.44 1093 8.13%
3 JPMorgan 314,826.88 1433 8.11%
4 Goldman Sachs 234,193.07 776 6.04%
5 Barclays 226,473.92 879 5.84%

Bookrunners of All Syndicated Loans EMEA

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 HSBC 34,312.86 161 6.59%
2 Deutsche Bank 34,194.98 116 6.57%
3 Bank of America Merrill Lynch 31,113.25 94 5.98%
4 BNP Paribas 27,479.75 167 5.28%
5 SG Corporate & Investment Banking 23,982.83 136 4.61%

Bookrunners of all EMEA ECM Issuance

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 JPMorgan 19,536.02 78 8.91%
2 Morgan Stanley 16,323.54 83 7.44%
3 Citi 15,667.80 92 7.14%
4 UBS 15,208.47 58 6.94%
5 Goldman Sachs 13,487.36 72 6.15%