Loans and High Yield

Michele Colocci has left JP Morgan and will rejoin Morgan Stanley as chairman of M&A.

For the second week running, high yield is making the pace in European corporate bond markets, with a further heavy slug of new issues after last week's splurge of supply.

Telecoms giant Altice announced a €2.8bn-equivalent dual currency high yield bond on Tuesday through Goldman Sachs. Along with the proceeds of the new notes, the group will spend €1.5bn to cut group leverage — a crucial move, as telecoms firms grapple with the high capital costs of preparing for the rollout of 5G technology.

Triple-B rated corporate debt has grown more than most other rating bands in EMEA in the past decade, according to Moody's, and now accounts for a record share at 41%. This level of the market has expanded, against a backdrop of generally somewhat declining credit quality.

The retail industry is in deep trouble, especially in the UK, where every other week it seems a storied High Street name tumbles into financial distress. Private equity sponsors, which owned many of the collapsed names, take much of the blame, but they were also victims of structural changes that battered the industry.

Fashion company PVH has refinanced its debt with a $2.6bn-equivalent loan package, with the Calvin Klein and Tommy Hilfiger owner signing bank lines in a variety of currencies.

Sirius Minerals has launched a bold $3.8bn financing transaction, combining equity, debt and a new loan facility, to fund the development of its Yorkshire potash mine project. JP Morgan, Sirius's corporate broker, is underwriting and organising the deal.

Just two Asian borrowers visited the international debt market on Monday, raising nearly a combined $800m ahead of the public holiday on May 1.

Fitch has downgraded Tewoo Group, a Chinese state-owned commodities trader, by six notches, citing the company’s weak liquidity and high leverage. The Tianjin government’s financial ability to support its related entities was also brought into question.

Indonesia’s Chandra Sakit Utama Leasing (CSUL) has launched a $75m offshore loan into general syndication.

Indomobil Finance Indonesia has paid up for its offshore loan return for a new $100m three year borrowing.

Dometic Group, the Swedish company that makes appliances for mobile homes, started the week by launching a €250m seven year high yield bond that was tightly priced, perhaps partly because the credit market was otherwise fairly quiet.