Graphic Packaging prices; Cumulus Media, Aker BP on tap; Hilton’s gains continue; Sprint drops

By Paul A. Harris and Abigail W. Adams

Portland, Me., June 11 – The domestic high-yield primary market saw another active session on Tuesday with one drive-by deal pricing and another joining the forward calendar.

Graphic Packaging International, LLC priced a $300 million issue of eight-year senior bullet notes (Ba2/BB+) at par to yield 4¾%.

Cumulus Media New Holdings Inc. started a brief roadshow for a $300 million offering of seven-year senior secured first lien notes, which is set to wrap up on Wednesday.

Norway-based Aker BP ASA set official price talk for its $500 million offering of five-year senior notes (Ba1/BB+/BBB-), which is set to price on Wednesday.

The European primary market was also in high-gear on Tuesday with two deals pricing and two more joining the forward calendar.

International Game Technology plc priced an upsized €750 million issue of seven-year senior secured notes (Ba2/BB+).

France-based Spie SA priced a €600 million issue of seven-year senior notes (Ba3/BB).

Italian pharmaceutical group Doc Generici started a roadshow for a €470 million offering and Progroup AG began marketing a €150 million tap of its 3% senior secured fixed-rate notes due March 31, 2026 (Ba3/BB-).

Meanwhile, the secondary space held firm and continued its rally even as equities dipped for the first time in six sessions.

Hilton Domestic Operating Co. Inc.’s newly priced 4 7/8% senior notes due 2030 were in focus with the notes continuing to post gains.

Sprint Corp.’s capital structure was under pressure after news broke that several states had filed suit to block the merger with T-Mobile.

Staples Inc.’s junk bonds were also active with the notes making notable gains.

Graphic Packaging drives by

The Tuesday primary market session generated a steady stream of news.

Graphic Packaging International, a very familiar name on the high-yield landscape, priced a $300 million issue of eight-year senior bullet notes (Ba2/BB+) at par to yield 4¾%.

The yield printed at the tight end of yield talk in the 4 7/8% area.

BofA, Citigroup, JP Morgan, Rabo, SunTrust, TD and Wells Fargo were the joint bookrunners for the debt refinancing deal.

Cumulus Media roadshows $300 million

Cumulus Media started a brief roadshow for a $300 million offering of seven-year senior secured first lien notes.

Initial price talk has the notes pricing to yield in the low 7% area, a trader said.

The roadshow wraps up on Wednesday.

BofA Securities is the left bookrunner for the bank debt refinancing deal.

Aker BP talk 4 7/8% to 5 1/8%

Looking to the Wednesday session, Norway-based Aker BP is on deck with a $500 million offering of five-year senior notes (Ba1/BB+/BBB-).

The deal was talked Tuesday to yield 4 7/8% to 5 1/8%, in line with initial talk in the low 5% area.

Global coordinator Barclays will bill and deliver. BNP Paribas, HSBC and MUFG are also global coordinators.

BMO Securities, Citigroup Global Markets Inc., ING, J.P. Morgan Securities LLC and Wells Fargo Securities LLC are the joint bookrunners.

IGT upsizes

The Euro-denominated new issue market also generated a steady stream of news on Tuesday.

International Game Technology priced an upsized €750 million issue of seven-year senior secured notes (Ba2/BB+) at par to yield 3½%.

The issue size was increased from €500 million.

Credit Agricole, UniCredit, Banca IMI, BofA, BNP Paribas, ING and Mediobanca were the joint lead bookrunners.

The London-based gaming company plans to use the proceeds to repay debt under its revolving credit facility, and for general corporate purposes.

Spie 2 5/8% print

France-based Spie SA priced a €600 million issue of seven-year senior notes (Ba3/BB) at par to yield 2 5/8%.

Initial price talk was in the 3% area.

The deal was oversubscribed, according to a press release from the company.

BNP Paribas, Natixis and SG CIB were the global coordinators.

Credit A.gricole CIB, Commerzbank, HSBC and ING were the joint bookrunners for the debt refinancing deal.

Doc Generici roadshows FRN

Italian pharmaceutical group Doc Generici is roadshowing a €470 million offering of senior secured floating-rate notes (B2) through Thursday, market sources say.

The issuing entity will be Diocle SpA.

Global coordinator BNP Paribas is the sole physical bookrunner.

UniCredit is also a global coordinator. Credit Agricole CIB is the joint bookrunner.

The Milan-based generic drugmaker plans to use the proceeds to refinance debt incurred in the spring when Intermediate Capital Group and Merieux Equity Partners acquire Doc Generici from CVC Capital Partners for €1.1 billion.

Progroup tapping 2026 notes

Progroup is in the market with a €150 million add-on to its 3% senior secured fixed-rate notes due March 31, 2026 (Ba3/BB-).

Deutsche Bank, Commerzbank, Goldman Sachs and HSBC are managing the sale.

The Germany-based containerboard manufacturer plans to use proceeds to fully redeem its €150 million floating-rate notes due 2024.

Hilton in focus

Hilton’s newly priced 4 7/8% senior notes due 2030 were in focus and continuing to post gains in secondary trading on Tuesday.

The 4 7/8% notes rose another ¼ point to par 7/8 by the late afternoon, according to a market source.

More than $75 million of the bonds had changed hands during Tuesday’s session.

Hilton priced an upsized $1 billion issue of 4 7/8% senior notes in a Monday drive-by.

The issue size was increased from $750 million.

Sprint drops

Sprint’s capital structure was under pressure on Tuesday after the attorney generals of several states filed suit to block its merger with T-Mobile.

Sprint’s 6 7/8% senior notes due 2028 dropped 3 points to 101¾ in high-volume activity, according to a market source.

More than $21 million of the bonds were on the tape by the late afternoon.

Sprint’s 8¾% senior notes due 2032 dropped 4 points to 112¾ with about $8 million in reported volume.

The 7 7/8% notes due 2023 dropped 2 points to 106½, and the 7 1/8% senior notes due 2024 dropped 1 7/8 points to 103½.

The notes were trading down after the wireless telecommunication’s company was met with another challenge to its merger with T-Mobile.

The attorney generals of nine states and the District of Columbia filed a lawsuit in New York to block the merger claiming it would stifle competition and cause consumer costs to surge, Bloomberg reported.

The suit comes as the Department of Justice nears a decision on the merger. The merger has already met with Federal Communications Commission approval.

Staples gains

Staples junk bonds saw large gains in the secondary space on Tuesday.

The 7½% senior notes due 2026 rose 1¼ points to 99¾. The 10¾% senior notes due 2027 rose 2 points to par ½, according to a market source.

Both issues were active with $16 million and $10 million in reported volume respectively.

Staples priced a $2 billion issue of the 7½% senior secured notes and a $1 billion issue of the 10¾% senior unsecured notes at par in early April.

The notes have struggled since breaking for trade with both spending the majority of their existence below par.

However, they have seen solid upward momentum since last week, a source said.

Indexes gains continue

Indexes continued their rally on Tuesday with all posting gains after starting the week off on strong footing.

The KDP High Yield Daily index gained 7 bps to close Tuesday at 70.16 with the yield now 5.69%.

The index rose 29 bps on Monday after a cumulative gain of 40 bps on the week last week.

The ICE BofAML US High Yield index crossed the 9% threshold for returns on Tuesday after only recently sinking below 8%.

The index gained 13.1 bps on Tuesday with the year-to-date return now 9.046%.

The index jumped 34.9 bps on Monday after a cumulative gain of 104.7 bps on the week last week.

The index again crossed the 8% year-to-date threshold last week after dropping below it on May 29.

The CDX High Yield 30 index climbed 29 bps to close Tuesday at 106.54.

The index jumped 39 bps on Monday after a cumulative gain of 132 bps on the week last week.

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