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MDC Partners Issued the Most Junk Bonds in the Week to March 18

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Pricing trends

Continuous improvement in market conditions brought high-yield issuers back to the primary market. The primary market saw six deals priced last week.

Mutual funds like the PIMCO High Yield Fund – Class A (PHDAX) and the Fidelity High-Income Fund (SPHIX) invest in junk bonds. Meanwhile, ETFs like the SPDR Barclays Capital High Yield Bond ETF (JNK) and the iShares iBoxx $ High Yield Corporate Bond Fund (HYG) also invest in junk bonds.

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Issuance by MDC Partners

MDC Partners (MDCA) offers marketing and communication network services. It issued dollar-denominated junk bonds worth $900 million on March 18. The senior notes were rated B3/B+ and carried a coupon of 6.5%. The bonds will mature in 2024. They were issued at 100% of the aggregate principal amount at a yield-to-worst of 6.5%.

MDC Partners intends to use the proceeds of the loan for refinancing purpose.

Issuance by CNH Industrial Capital

CNH Industrial Capital is a wholly owned subsidiary of CNH Industrial N.V. (CNHI). It issued dollar-denominated junk bonds worth $500 million on March 14. The senior notes were rated B1/BB and carried a coupon of 4.9%. The bonds will mature in 2021. They were issued at 99.5% of the aggregate principal amount at a yield-to-worst of 5.0%.

CNH Industrial Capital intends to add the net proceeds from the offering to its general funds. It plans to use them for working capital and other general corporate purposes including, among other things, the purchase of receivables or other assets in the ordinary course of business.

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Issuance by Radian Group

Radian Group (RDN) provides private mortgage insurance, risk management products, and real estate services to financial institutions. It issued dollar-denominated junk bonds worth $350 million on March 15. The senior notes were rated Ba3/BB- and carried a coupon of 7.0%. The bonds will mature in 2021. They were issued at 100% of the aggregate principal amount at a yield-to-worst of 7.0%. The company intends to use the proceeds from the loan for general corporate purposes.

Issuance by Avis Budget Car Rental

Avis Budget Car Rental is a wholly owned subsidiary of Avis Budget Group (CAR). It issued dollar-denominated junk bonds worth $350 million on March 14. The senior notes were rated B1/B+ and carried a coupon of 6.4%. The bonds will mature in 2024. They were issued at 100% of the aggregate principal amount at a yield-to-worst of 6.4%. The company intends to use the proceeds from the loan for refinancing purposes.

In the next part, we’ll look at high-yield bond fund flows and the yield movement of bond funds.

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