Euro high yield breaks new frontier with B- divi deal

By Owen Sanderson
21 May 2020

The slowly reopening European high yield market faced another test on Tuesday, following Sappi’s decision to pull its planned issue at the end of last week. Data centre and cable network firm Cogent raised a B3/B- rated add-on in order to pay a dividend. The company is too leveraged already to allow a dividend under its existing bond docs but used a “temporary deleveraging” and escrow structure to work around them.

Bank of America led the €215m add-on to Cogent’s existing 4.375% 2024 notes with an investor call on Tuesday and pricing later that day.

Following the call, the bank circulated price talk of 99.01-99.5 around Tuesday lunchtime, with final pricing at the top end of the range by ...

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