High-Yield Market Faces Continued Supply Shortage

The high-yield new issue calendar is surprisingly quiet heading into the fourth quarter, with no large deals in the market at the moment and only a handful of deal having been priced since Labor Day.

  • 17 Sep 2004
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The high-yield new issue calendar is surprisingly quiet heading into the fourth quarter, with no large deals in the market at the moment and only a handful of deal having been priced since Labor Day. “I would have expected to see the calendar build and traders pull liquidity out of the market place causing spreads to widen, but it hasn’t happened yet,” said Richard Coons, portfolio manager of Catrock Capital Management.
 
With $850 million of inflow into high-yield in the past few weeks and no new issuance, the market has tightened. This allows for issuers to sell deals with more aggressive structures, said one high-yield banker. “From an issuer’s perspective, you can achieve a better coupon right now. It’s not going to get any better than this,” he added. MGM Mirage’s recently issued 6% of ’9s had the lowest yield ever issued for a gaming credit, according to a banker at J.P. Morgan, which underwrote the deal. 
 
The forward calendar consists mainly of deals from highly leveraged companies, notably Vanguard Health Holding, rated Caa2 by Moody’s Investors Service, and Graham Packaging Company, rated Caa1 by. Despite investor demand for paper, one buyer expressed ambivalence over how the Vanguard deal will go. “It’s a $700 million deal led by Citigroup, and I’m not sure they put triple-Cs out so well,” he said, adding $700 million is very larger for a triple-C sale. Joe Christinat, spokesman for Citigroup, did not return calls by press time.  
  • 17 Sep 2004

All International Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 23 Jan 2017
1 Citi 35,941.13 111 8.93%
2 Barclays 31,588.47 86 7.85%
3 JPMorgan 27,799.55 107 6.91%
4 Bank of America Merrill Lynch 27,706.86 75 6.88%
5 HSBC 21,949.38 82 5.45%

Bookrunners of All Syndicated Loans EMEA

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 17 Jan 2017
1 Commerzbank Group 114.00 1 66.16%
2 CaixaBank 37.05 1 21.50%
3 UniCredit 10.62 1 6.17%
3 BNP Paribas 10.62 1 6.17%
Subtotal 172.30 3 100.00%

Bookrunners of all EMEA ECM Issuance

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 17 Jan 2017
1 SG Corporate & Investment Banking 770.06 2 16.80%
2 Goldman Sachs 656.16 2 14.32%
3 JPMorgan 527.28 4 11.50%
4 Emirates NBD PJSC 408.38 1 8.91%
5 Deutsche Bank 321.53 3 7.01%