Loans and High Yield

China Evergrande Group raised $3bn with a tap of three of its existing bonds, but the issuance put a dent in its secondary curve as noteholders fled to the juicier new deal.

Investors put their faith in Mongolia’s recovery story this week, helping Mongolian Mortgage Corp (MIK) raise $250m from a bond that showed appetite for frontier market risk. Addison Gong reports.

Profit Reach, an investment vehicle owned by Chinese billionaire Shen Guojun, is seeking a $550m refinancing loan with a rare put option provided to lenders. The deal has raised debate over whether the structure can catch on in Asia. Pan Yue reports.

Club-style Chinese deals were back this week as Peking University Founder Group Co raised $150m from a three year bond and Yankuang Group grabbed $215m.

Apollo Global Management is to buy UK plastic packaging producer RPC in a £3.323bn debt-backed leveraged buyout. The US private equity firm beat off competition from Bain for the FTSE 250 listed company.

Corporate bond spreads widened in the fourth quarter of 2018, adding to the overall negative returns the asset class provided investors with over the year. However, with spreads now back at levels not seen since 2016, investors are considering increasing their allocations to the sector once more.

Mongolian Mortgage Corp (MIK) showed that investors have the appetite to take on frontier market risk, raising a larger-than-expected $250m from an issuance that was months in the making.

China Evergrande Group hit its size goal of $3bn with a tap of three of its existing bonds, a strategic decision by the property developer. But the issuance dented its secondary curve as noteholders fled to the juicier new transaction.

AC Energy raised $225m from the first public green dollar bond from the Philippines, a deal in line with its renewable energy-related ambitions.

Five high yield bond issues were launched in the US on Tuesday, and at least a couple more are expected on Wednesday and Thursday - fruit of the sharp turnround in sentiment in the past fortnight. This is lifting the spirits of bankers in London, who are finding it very hard to encourage issuers into the market.

BNP Paribas has made a string of senior appointments to complete the reorganisation of its corporate and institutional bank that began at the end of last year.

Asia’s offshore bond market has had a strong start to the year, moving past the doom and gloom that ended 2018. But there are already signs that the difficult conditions that defined last year may only be around the corner.