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Altice Was Highest Junk Bond Issuer in Week Ended September 25

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Pricing trends

Pricing levels kept some transactions in the negotiation phase in the week ended September 25, 2015, as yields ran up sharply. ETFs like the SPDR Barclays High Yield Bond ETF (JNK) and the iShares iBoxx $ High Yield Corporate Bond ETF (HYG) invest in junk bonds.

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Deal highlight of the week

Netherlands-based Altice N.V. issued $4.8 billion in junk bonds on September 25. The three-tranche issue consisted of:

  • $1.0 billion in 6.625% Ba1/BB- rated senior secured notes due on October 15, 2025
  • $1.8 billion in 10.125% B2/B- rated senior notes due on January 15, 2023
  • $2.0 billion in 10.875% B2/B- rated senior notes due on October 15, 2025

Altice raised these bonds to fund its previously announced $17.7 billion acquisition of US cable system operator Cablevision Systems Corporation (CVC).

Issuance by Olin Corp.

Olin Corp. (OLN) is a manufacturer of chlor-alkali products. It issued $1.22 billion in junk bonds on September 25. The Ba1/BB+ rated bonds were issued via the following two tranches:

  • $720 million in 9.75% senior notes due on October 5, 2023
  • $500 million in 10.0% senior notes due on October 15, 2025

Olin issued these bonds to raise money for its acquisition of Dow Chlorine Products, the chlor-alkali business of The Dow Chemical Company (DOW).

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Issuance by Iron Mountain

Iron Mountain Incorporated (IRM) is a real estate investment trust that provides storage and information management services. It issued $1.0 billion in senior notes September 24. The bonds were rated Ba3/B+ and carried a coupon of 6.0%.

The senior notes will mature on October 1, 2020. Iron Mountain will use proceeds from the sale to refinance older debt.

Issuance by Tempur Sealy International

Tempur Sealy International Inc. (TPX) manufactures bedding products and issued $450 million in senior notes on September 21. The bonds were rated B2/BB- and carried a coupon of 5.625%. The junk bonds will mature on October 15, 2023. Tempur Sealy International will use proceeds from the sale to refinance older debt.

Issuance by Orbital ATK

Orbital ATK (OA) designs and builds space, defense, and aviation-related systems. It issued $400 million in senior notes on September 22. The bonds were rated Ba3/BB and carried a coupon of 5.5%, and they will mature on October 1, 2023. Orbital ATK will use proceeds of the sale for refinancing older debt.

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