Loans and High Yield

The mystery of the European high yield paradox grew this week as investors began tucking into €4.5bn of new bonds amid all-time low yields. Yet they face a puzzlingly thin deal pipeline for the second half of the year. But dormant borrowers are starting to wake up to the joys of primary, said bankers and lawyers.

Panama severed diplomatic ties with Taiwan this week in favour of supporting China, leaving syndicated loans bankers in Taiwan divided about how the move will affect their business, as several Panamanian institutions have tapped Taiwanese bank liquidity for funds in the past. Shruti Chaturvedi reports.

Greenland Holding Group Company is out with a 363 day dollar bond on Thursday, its second outing with a short tenor but its first in the public format.

HNA Group company Hainan Airlines Holding Co rolled out a 364 day bond on Thursday, becoming the second issuer to seek a short-term deal recently. Meanwhile, Chinese oilfield equipment provider Hilong Holding is selling an inaugural three year note.

Buyers of sterling high yield bonds were set to show what they make of the June 8 elections in the UK, and the country's economic landscape on Tuesday, as online grocer Ocado priced the first all-round domestic deal since the vote.

Swiss telecoms UPC Holding, a Liberty Global subsidiary, brought its second 12 year bond offering on Wednesday, the longest maturity sold in the European high yield market so far this year.

On paper, the message from investors in the European leveraged finance market appears to be: ‘What are you waiting for?” Finally, this week, issuers appeared to have obliged them.

The private equity majority owners of Indian IT company Mphasis raised $500m on Tuesday from a five year non-call two deal, despite it having a structure that is quite unfriendly to bondholders.

Once troubled Chinese property developer Kaisa Group Holdings, which launched an exchange offer last week, has released minimum yields on the four sets of new fixed rate notes that will replace its outstanding variable rate senior bonds.

Chinese firm Essence International Financial Holdings has approached lenders for a HK$1bn ($128m) borrowing.

French laundry services firm Elis has signed a bridge facility with two relationship banks for its £2.2bn acquisition of UK competitor Berendsen, having announced it will fund the 63% cash portion of the deal through third party debt.

Primary high yield bond issuance from the gambling industry will be rare this year, Moody’s said in a report on Tuesday. But the story may be different in the leveraged loan market.