Junk stays quiet as holiday approaches but Lindorff talks euro deal; funds lose $227 million

By Paul Deckelman and Paul A. Harris

New York, Sept. 3 – The high-yield market passed another largely quiet session on Thursday, the last full trading day before the Labor Day holiday break in the United States.

For the first time in a few weeks, there was some new-deal news coming out of Europe, with Norway’s Lindorff Group AB heard to have set price talk on an upsized €230 million two-part add-on to the financial information services providers’ existing notes; the deal was on track to be the first euro-denominated junk transaction to get done in the past month.

Among existing issues, there was more trading in Vantage Drilling Co., in the aftermath of the news that Brazil’s state-run oil company had abruptly cancelled its contract with the provider of maritime energy drilling services, alleging that Vantage had breached the terms of the agreement, which the company denies.

Statistical measures of junk market performance were higher across the board for a second straight session on Thursday. They had improved on Wednesday, after having been lower all around on Tuesday and mixed over the two sessions before that.

However, another numerical indicator – flows of investor cash into or out of high-yield mutual funds and exchange-traded funds – saw net redemptions by investors for a second consecutive week, and for a fifth week out of the last six, as $227 million more left those funds than came into them in the reporting week ended Wednesday.

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