Portability becoming almost standard on sponsor-driven high yield bonds

portabilityclause cropped as image for website
By Victor Jimenez
20 Oct 2014

High yield bonds with portability clauses that allow the issuers to bypass change of control covenants have increased their presence in the market, according to research published on October 17 by Moody’s.

Driving the trend, Moody’s analysts in London and New York say, are private equity firms seeking greater flexibility to sell their leveraged buyout investments.

Most high yield bonds carry change of control covenants obliging the borrower to repurchase outstanding bonds at 101 if the company changes hands, and ...

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