Tekni-Plex starts roadshow; Kedrion/Kevlar under pressure; Allwyn at a premium; SiriusXM active

By Paul A. Harris and Abigail W. Adams

Portland, Me., April 24 – The high-yield primary market saw an active start to the week with two dollar-denominated deals joining the forward calendar.

Trident TPI Holdings, Inc., the parent of Tekni-Plex Inc., launched a two-day roadshow for a $620 million offering of senior notes due December 2028 (S&P: CCC+).

Benteler International AG also began marketing a $500 million tranche of five-year senior secured notes.

Euro-denominated issuers were also active with Bormioli Pharma, Cheplapharm, Loxam and TDC Net announcing offerings.

Meanwhile, it was another quiet and flat day in the secondary space as broader markets continued to struggle to find direction.

Liquidity remained thin with activity concentrated in new and recent issues.

The deals that priced during Friday’s session were following different directions in the aftermarket.

Allwyn Entertainment Financing (UK) plc’s 7 7/8% senior notes due 2029 (BB/BB-) continued to trade at a strong premium to their issue price.

However, Kedrion Biopharma/Kevlar SpA’s 6½% senior secured notes due 2029 (B3/B) saw heavy selling pressure with the notes sinking further below their deeply discounted issue price.

Outside of recent issues, Sirius XM Holdings Inc.’s senior notes (Ba3/BB) were active although largely unchanged on the cusp of the broadcaster’s earnings report.

Monday’s primary

Propelled by $550 million to $600 million of reverse inquiry Trident TPI Holdings, the parent of Tekni-Plex Inc., showed up in the high-yield new-issue market on Monday, beginning a two-day roadshow for its $620 million offering of senior notes due December 2028 (S&P: CCC+), according to sources.

The deal is in the market with initial guidance that proposes a 13% coupon with two points to three points of OID, resulting in an all-in yield in the mid-to-high 13% area.

Elsewhere in the dollar-denominated market Salzburg-based automotive parts and technology company Benteler International AG commenced marketing a $500 million tranche of five-year senior secured notes, in the market with initial talk in the 10½% area.

Benteler also announced it will sell €525 million of those notes.

That was part of over €2 billion-plus of overall euro issuance announced by five issuers on Monday, all of it expected to price before Friday’s close.

Euro-denominated issuers announcing on Monday also include Bormioli Pharma, Cheplapharm, Loxam and TDC Net.

The floodgates of the euro-junk new-issue market were expected to burst open on Monday because school holidays in the United Kingdom ended last Friday, a high-yield portfolio manager noted.

Allwyn at a premium

Allwyn Entertainment’s recently priced dollar-denominated tranche was putting in a strong performance in the aftermarket, trading at a strong premium to their issue price.

The 7 7/8% senior notes due 2029 were trading on a 101-handle with the notes trading as high as 101 7/8, a source said.

There was $31 million in reported volume.

Allwyn Entertainment priced a $700 million tranche of the 7 7/8% notes at par to yield 7.881% as part of a €1.3 billion equivalent two-tranche offering on Friday.

The 7 7/8% notes priced tight to talk in the 8% area.

The deal also included a €665 million tranche of 7¼% notes due in 2030, which priced at par to yield 7.255%.

Kendrion/Kevlar sinks

Kendrion/Kevlar SpA’s 6½% senior secured notes due 2029 saw heavy selling pressure on Monday and were dragged further below their deeply discounted issue price following a weak break.

The 6½% notes shed another 1½ points in active trade on Monday.

They opened the session wrapped around 83 “and went down from there,” a source said.

The notes closed the day in the 81½ to 82 context with the yield just shy of 10½%.

The pharmaceutical company priced a $790 million issue of the 6½% senior secured notes at 84 to yield 9.963% on Friday.

Pricing came in line with talk.

SiriusXM active

SiriusXM’s senior notes were active although with little movement in price with the broadcaster scheduled to report earnings later in the week.

The 3 7/8% senior notes due 2031 continued to trade on a 75-handle, closing the day at 75¾ with the yield about 7 7/8%, according to a market source.

There was $19 million in reported volume.

The 4 1/8% senior notes due 2030 continued to trade in the 79¾ to 80¼ context with the yield about 7¾%, a source said.

There was $17 million in reported volume.

The 4% senior notes due 2028 remained in the 84½ to 85 context with the yield just shy of 7½%, a source said.

There was $16 million in reported volume.

The large, liquid issues were active with the company scheduled to report earnings on Thursday.

Market players may also be eyeing the notes, which are trading well wide of the BB index, a source said.

Fund flows

The dedicated high-yield bond funds saw $349 million of net daily cash inflows on Friday, the most recent session for which data was available at press time, according to a market source.

High-yield ETFs saw $205 million of inflows on the day.

Actively managed high- newnyield funds saw $144 million of inflows on Friday, the source said.

Indexes

The KDP High Yield Daily index gained 9 points to close Monday at 51.18 with the yield 7.11%.

The index posted a cumulative loss of 23 points on the week last week.

The ICE BofAML US High Yield index rose 21.2 bps with the year-to-date return now 4.394%.

The CDX High Yield 30 index shed 1 bps to close Monday at 101.28.

The index posted a cumulative loss of 18 bps on the week last week.

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