First Data was the Highest Junk Bond Issuer: Week to August 7
Junk bond issuance activity rose in the week ending August 7 after two weeks of subdued activity. The broad market conditions improved.
Aug. 13 2015, Published 3:56 p.m. ET
Pricing trends
Junk bond issuance activity rose in the week ending August 7 after two weeks of subdued activity. The broad market conditions improved.
ETFs like the SPDR Barclays High Yield Bond ETF (JNK) and the iShares iBoxx $ High Yield Corporate Bond ETF (HYG) invest in junk bonds.
Deal highlight of the week
First Data provides e-commerce solutions to financial institutions and card issuers. It issued junk bonds worth $1.21 billion last week. The bonds were rated B1/BB- and carried a coupon of 5.375%. The bonds will mature on August 15, 2023. They were issued at 100% of their par value with a yield-to-worst of 6%. First Data intends to use the proceeds of the sale for refinancing older debt.
Issuance by Pharmaceutical Product Development
Contract research company Pharmaceutical Product Development raised junk bonds worth $1.125 billion last week. The bonds were rated Caa1/B- and carried a coupon of 6.375%. The bonds will mature on August 1, 2023. They were issued at 100% of their par value with a yield-to-worst of 6.375%. Pharmaceutical Product Development intends to use the proceeds of the sale for refinancing older debt.
Issuance by Anixter International
Anixter International (AXE) issued senior notes worth $350 million last week. The bonds were rated Ba3/BB and carried a coupon of 5.50%. The junk bonds will mature on March 1, 2023. They were issued at 100% of their par value with a yield-to-worst of 5.50%. Anixter will use proceeds of the sale to acquire HD Supply Holdings’ (HDS) power solution business.
Issuance by HealthSouth
HealthSouth (HLS) operates rehab hospitals. It issued senior add-on notes worth $300 million last week. The bonds were rated B1/B+ and carried a coupon of 5.75%. The junk bonds will mature on November 1, 2024. They were issued at 100.50% of the par value with a yield-to-worst of 5.626%. HealthSouth issued these junk bonds to use the proceeds to acquire Reliant Hospital Partners.
Issuance by RSP Permian
Oil and natural gas company RSP Permian (RSPP) issued senior add-on notes worth $200 million last week. The bonds were rated B3/B- and carried a coupon of 6.625%. The junk bonds will mature on October 1, 2022. They were issued at 99.25% of their par value with a yield-to-worst of 6.757%.