Junkland: New Home prices; Matador, VMED, GGAM improve; Algoma softens

By Abigail W. Adams

Portland, Me., March 27 – While the European high-yield primary market continued to roll off deals at an active clip, the domestic high-yield primary market cooled its pace after logging one of the busiest days of the year on Tuesday.

New Home Co. Inc. cleared the dollar-denominated calendar by pricing a downsized $300 million issue of 5.5-year senior notes (B2/B-).

While Thursday’s session is not expected to generate much activity with the market winding down ahead of the holiday weekend in the United States, Dye & Durham Corp.’s planned offering of $500 million of secured debt and the Genesee & Wyoming Inc. upcoming offering of $1 billion of secured notes remain on the shadow calendar.

Meanwhile, it was an active day in the secondary space with the seven deals that priced during Tuesday’s session dominating the tape.

The cash bond market was relatively flat for the majority of the session but was lifted into the close as the market rallied after the seven-year Treasury auction went well, a source said.

The new paper was putting in solid performances across the board with all issues trading with premiums to their issue prices.

Algoma Steel Inc.’s new 9 1/8% senior secured second-lien notes due 2029 (B3/B/BB-) were coming in slightly after a strong break although they continued to trade with a premium.

Matador Resources Co.’s 6½% senior notes due 2032 (B1/BB-/BB-), VMED 02 UK Financing I plc’s 7¾% senior secured notes due 2032 (Ba3/B+/BB+), and Griffin Global Asset Management subsidiary GGAM Finance Ltd.’s 6 7/8% senior notes due 2029 (BB-/BB) improved in heavy volume.

AMC Networks Inc.’s 10¼% senior secured notes due 2029 (Ba3/BB) and Phinia Inc.’s 6¾% senior secured notes due 2029 (Ba1/BB+) were unchanged on the day with both issues holding on to the strong gains made on the break.

New Home breaks

New Home was the sole issuer to price a dollar-denominated deal on Wednesday.

The Irvine, Calif.-based homebuilder priced a downsized $300 million, from $325 million, issue of 5.5-year senior notes at par to yield 9¼%.

The yield priced on top of talk.

While volume was light, the new paper had a strong break and was trading in the par ½ to 101 context heading into the market close, a source said.

Algoma slips

Algoma Steel’s 9 1/8% senior secured second-lien notes due 2029 slipped on Wednesday after a strong break.

The 9 1/8% notes were off about 1/8 to ¼ point to trade in the par to par ½ context, a source said.

There was $18 million in reported volume.

The notes closed the previous session in the par 3/8 to par 5/8 context.

Algoma priced a $350 million issue of the 9 1/8% notes at par on Tuesday.

Pricing came tighter than talk for a yield of 9¼% to 9½%.

Improved

Matador Resources’ 6½% senior notes due 2032 were again on the rise in heavy volume on Wednesday.

The 6½% notes added 1/8 to ¼ point to close Wednesday in the par 1/8 to par 3/8 context.

There was $77 million in reported volume.

The notes initially jumped after breaking for trade on Tuesday to hit as high as par ¾.

However, they came in to close Tuesday wrapped around par.

Matador priced an upsized $900 million, from $800 million, issue of the 6½% notes at par in a Tuesday drive-by.

Pricing came at the wide end of revised talk for a yield of 6 3/8% to 6½%, which tightened from earlier official talk for a yield of 6½% to 6¾%.

VMED’s 7¾% senior secured notes due 2032 were also on the rise after a lackluster break the previous session.

The notes added about ¼ point to close the day in the par to par ¼ context, a source said.

They lagged their issue price after breaking for trade the previous session.

VMED priced a $750 million issue of the 7¾% notes at par in a Tuesday drive-by.

Pricing came at the wide end of talk for a yield of 7 5/8% to 7¾%.

GGAM’s 6 7/8% senior notes due 2029 also gained about ¼ point to trade up to the par 3/8 to par 5/8 context, a source said.

GGAM priced a $400 million issue of the 6 7/8% notes at par in a Tuesday drive-by.

Pricing came tighter than talk for a yield in the 7 1/8% area.

Holding premium

AMC Networks’ 10¼% senior secured notes due 2029 and Phinia’s 6¾% senior secured notes due 2029 were unchanged on the day with both holding on to the strong gains made on the break.

AMC Networks’ 10¼% senior secured notes due 2029 were up 1/8 to ¼ point early in the session to trade on a 101-handle.

However, they gave back early gains to trade in the par 7/8 to 101 1/8 context heading into the close, a source said.

There was $89 million in reported volume.

AMC Networks priced an upsized $875 million, from $700 million, issue of the 10¼% notes at par on Tuesday.

Pricing came tighter than talk for a yield in the 10½% area.

Phinia’s 6¾% senior secured notes due 2029 continued to trade in the par 7/8 to 101 1/8 context, a source said.

There was $46 million in reported volume.

Phinia priced an upsized $525 million, from $425 million, issue of the 6¾% notes at par on Tuesday.

Pricing came tighter than talk for a yield in the 7% area.

Indexes

The KDP High Yield Daily index added 8 basis points to close Wednesday at 50.84 with the yield 6.81%.

The index was flat on Tuesday and off 6 bps on Monday.

The ICE BofAML US High Yield index added 9.1 bps with the year-to-date return now 1.413%.

The index slid 3.8 bps on Tuesday and 6 bps on Monday.

The CDX High Yield 30 index added 26 bps to close Wednesday at 107.24.

The index was off 5 bps on Tuesday and 4 bps on Monday.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.