Morning Commentary: Fortescue Metals, Hill-Rom junk bonds on tap; Extended Stay eyed

By Cristal Cody

Tupelo, Miss., Sept. 5 – At least two issuers are marketing new junk bonds over Thursday’s session.

Fortescue Metals Group Ltd. expects to bring $600 million of eight-year notes to the primary market.

Initial price talk is in the 4½% area.

Hill-Rom Holdings, Inc. also is on deck with a $425 million offering of eight-year guaranteed senior notes that were initially talked to price in the 4¾% area.

Both deals are expected to price on Thursday, a source said.

Straight high-yield dollar-denominated volume week to date totals $2.8 billion, including a $1 billion offering of 10-year senior notes on Wednesday from Iron Mountain Inc.

In other high-yield market action on Thursday, Extended Stay America Inc. is holding investor calls for a $500 million offering of new notes.

The junk bond market opened the day about 1/8 point better after closing Wednesday modestly higher, sources report.

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