Bonds back on top as Techem changes tack
High yield bonds are back on top as the capital markets funding tool of choice for leveraged companies. This week, Techem tweaked its loan repricing to add a heavy bond slug and take advantage of near-record low coupons on offer. That sets 2020 up with a very different tone from the past two years, when an ever-growing CLO market meant bonds struggled to compete with loans, writes Owen Sanderson.
Techem announced its €2.3bn loan repricing last week, aiming initially to cut the 350bp margin on the term loan to 300bp-325bp with a 99.875 original issue discount (OID). The loan market more than delivered, with the range revised down, and the deal landed at 287.5bp, priced at par....
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