Loans and High Yield

Indonesian palm oil seller Royal Industries is looking to restructure a $405m loan after failing to repay the first and second instalments. And going by precedents, market participants are bracing themselves for a long-winded recovery process as legal proceedings unfold, writes Shruti Chaturvedi.

HSBC has appointed a new head of leveraged and acquisition finance for Asia Pacific, transferring James Horsburgh from London as part of a shake-up of the business.

HSBC confirmed that it was sending James Horsburgh, a senior member of its EMEA leveraged finance team, to run the business in Asia, as previously reported in GlobalCapital.

Chinese high yield names KWG Property Holding and Kangde Xin Composite Material Group Co, as well as unrated Lenovo Group, launched dollar deals on Thursday morning — just one day after Indian high yield issuer Eros International pulled its bond because of weak demand.

French funeral group OGF launched a €960m cov-lite term loan ‘B’ this week as minority owner Ontario Teachers’ Pension Plan plans to increase its stake to 74%.

Tele Columbus led a band of issuers piling back into the leveraged loan market for repricing requests this week, ahead of an expected wave of new leveraged buyouts in Europe.

Salt Mobile, the Swiss telecom company, is asking an issuer-friendly HY market to tap some of its old bonds, waive covenants on them, and fund a dividend to its owner NJJ Capital with a new floater.

Volkswagen’s main borrowing entities have not issued unsecured bonds since the company became embroiled in its diesel emissions test cheating scandal in September 2015. Last week, however, the company took a first step back, with a €900m Schuldschein issue for its financial services arm.

Eros International failed to price its new dollar bond on Tuesday, as the high yield market stuttered and investors pushed back on pricing for the Indian film maker’s international debut.

Guorui Properties and Kangde Xin Composite Material Group are preparing for their respective debuts in the international debt market.

HSBC is understood to be considering transferring a banker from London to take over leveraged and acquisition finance responsibilities for Asia Pacific. This follows the departures of senior Hong Kong-based bankers from the levfin and sponsor coverage teams last month.

European high yield bond issuance is being squashed by central banks and CLOs, with primary supply heavily concentrated on the double-B names that need the market least. Keeping the market healthy means finding a new purpose.