Radian, Renal Care price; MCC for Friday; Nexstar on tap; Harsco, Cumulus, Outfront in focus

By Paul A. Harris and Abigail W. Adams

Portland, Me., June 13 – The domestic high-yield primary market continued its active pace on Thursday with two deals pricing.

U.S. Renal Care, Inc. priced a $505 million issue of 10 5/8% eight-year senior notes (Caa2/CCC+) at par to yield 10.622%.

In drive-by action, Radian Group Inc. priced an upsized $450 million issue of senior bullet notes due March 15, 2027 (Ba2/BB+) at par to yield 4 7/8%.

Multi-Color Corp. is expected to price its $1.39 billion two-part offering on Friday when PGS ASA (Petroleum Geo-Services ASA) may also possibly price its $150 million offering of senior secured second-lien notes due January 2025.

The forward calendar also grew with Nexstar Broadcasting, Inc. kicking off a $1.12 billion offering of eight-year senior notes.

Meanwhile, new paper was in focus in the secondary space.

While Harsco Corp.’s 5¾% senior notes due 2027 (Ba2/BB-/BB) were coming in from their highs after breaking for trade on Wednesday, the notes were still trading at a large premium to their issue price.

Cumulus Media New Holdings Inc.’s 6¾% senior notes due 2026 (B2/B) were also slightly weaker on Thursday while maintaining a solid premium.

Outfront Media Capital LLC’s newly priced 5% senior notes due 2027 (expected B1/BB-) were volatile on Thursday, starting the day down but closing with slight gains.

While focus remained on the new paper, Hertz Global Holdings, Inc.’s capital structure jumped on Thursday on news that it planned to refinance its junk bonds maturing in 2020 and 2021.

Meanwhile, the recent trend of outflows reversed course with high-yield mutual funds and exchange-traded funds adding $1.718 billion for the week ended Wednesday.

The inflow follows the largest outflow of 2019 when $3.22 billion left the space for the week ended June 5.

U.S. Renal Care prices

Amid a steady stream of new issue news on Thursday, U.S. Renal Care priced a $505 million issue of 10 5/8% eight-year senior notes (Caa2/CCC+) at par to yield 10.622%.

The yield printed toward the wide end of yield talk in the 10½% area.

The buyout deal underwent covenant changes that bear primarily upon how the company may disburse cash and incur additional debt.

Barclays was the lead left bookrunner.

Radian oversubscribed, upsized and tight

In drive-by action, Radian Group priced an upsized $450 million issue of senior bullet notes due March 15, 2027 (Ba2/BB+) at par to yield 4 7/8%.

The issue size increased from $350 million.

The yield printed at the tight end of yield talk in the 5% area and inside of initial talk in the low 5% area.

The debt refinancing deal was heard to have been three-times oversubscribed at its original $350 million size, a trader said.

Lead left bookrunner RBC Capital Markets LLC will bill and deliver. Goldman Sachs & Co. LLC was the joint bookrunner.

Multi-Color sets talk

Looking to the Friday session, Multi-Color Corp. is on deck with a $1.39 billion two-part offering.

Price talk surfaced Thursday.

The deal includes $650 million of seven-year senior secured notes (B2/B) talked to yield in the 7% area, tight to initial guidance in the low 7% area.

The unsecured tranche features $740 million of eight-year senior notes (Caa2/B-) talked to yield 10% to 10¼%, well wide of initial guidance in the low 9% area.

Books close at noon ET Friday.

BofA Securities Inc. is the left bookrunner for the merger financing.

Away from the Multi-Color deal, sources are watching for PGS ASA to possibly price its $150 million offering of senior secured second-lien notes due January 2025 (Caa2/CCC+/CCC+) ahead of the coming weekend.

The debt refinancing transaction was marketed by means of a global roadshow.

As the market awaits official talk, the Barclays-led deal was whispered in the 12% area.

Nexstar kicks off $1.12 billion

Nexstar Broadcasting kicked off a $1.12 billion offering of eight-year senior notes on Thursday.

There are plans to market the deal on an investor conference call that will take place during the June 17 week.

BofA Securities Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., MUFG, SunTrust Robinson Humphrey Inc., BNP Paribas Securities Corp. and Citizens Capital Markets Inc. are the joint bookrunners.

The Irving, Tex.-based diversified media company plans to use the proceeds, along with $3.74 billion of bank debt, to help fund the acquisition of Tribune Media Co., a Chicago-based owner of television and digital properties, as well as to repay existing Tribune Media debt and for general corporate purposes.

Harsco in focus

Harsco’s 5¾% senior notes due 2027 were in focus in the secondary space on Thursday.

While the notes were coming in from the heights reached after breaking for trade on Wednesday, they continued to trade at a large premium to their issue price.

The 5¾% notes were seen at 102 bid, 102 3/8 offered early in the session. They were changing hands at 102¼ shortly before the market close, according to a market source.

More than $115 million of the bonds were in play during Thursday’s session.

Like most double-B paper, the notes were well bid out of the gate, trading as high as 102½, sources said.

Harsco priced a $500 million issue of the 5¾% notes at par on Wednesday.

Pricing came in line with official talk in the 5 7/8% area.

Cumulus weakens

Cumulus Media’s 6¾% senior notes due 2026 were active with the notes also coming in from the heights reached after breaking for trade on Wednesday.

The notes were seen at 101 bid, 101½ offered early in the session.

They came in as the session progressed and were seen changing hands at par ¾ in the late afternoon, according to a market source.

The new paper saw more than $61 million in reported volume during Thursday’s session.

Cumulus Media priced an upsized $500 million issue of the 6¾% notes at par on Wednesday.

Pricing came low to official talk for a yield in the 7% area, which was in line with initial price talk in the low 7% area, a market source said.

The initial size of the deal was $300 million.

Outfront gains

Outfront Media’s newly priced 5% senior notes due 2027 saw slight gains in secondary trading on Thursday.

The notes were seen at 99¾ bid, par ¼ offered early in the session, according to a market source.

However, they improved as the session progressed and were trading hands at par 5/8 in the late afternoon.

More than $36 million of the bonds were on the tape during Thursday’s session.

The notes closed Wednesday at par ½.

Outfront Media priced an upsized $650 million offering of eight-year senior notes (expected B1/BB-) at par to yield 5% in a Wednesday drive-by, sources said.

Official price talk was in the 5 1/8% area.

The deal was upsized from $550 million.

Hertz jumps

Hertz’s capital structure jumped on Thursday after the car rental company announced its intention to refinance its senior notes maturing in 2020 and 2021, a market source said.

Hertz’s 5½% senior notes due 2024 skyrocketed 5 5/8 point in high-volume activity.

The notes traded up to 92 with more than $32.5 million of the bonds on the tape by the late afternoon.

Hertz announced a rights offering on Thursday to raise proceeds to refinance its senior notes with upcoming maturities.

The company expects gross proceeds of $750 million from the offering, according to a company news release.

Hertz announced plans to refinance its 5 7/8% senior notes due Oct. 15, 2020 and its 7 3/8% senior notes due 2021 on its first quarter earnings call, Prospect News previously reported.

Indexes gain

Indexes were on the rise on Thursday after ending Wednesday on a down note.

The KDP High Yield Daily index gained 3 basis points to close Thursday at 70.12 with the yield now 5.72%.

The index shaved off 7 bps on Wednesday, gained 7 bps on Tuesday and rose 29 bps on Monday.

The ICE BofAML US High Yield index was again flirting with a 9% return after dropping below it on Wednesday.

The index was up 6.6 bps on Thursday with the year-to-date return now 8.996%.

The index was down 11.6 bps on Wednesday, gained 13.1 bps on Tuesday and jumped 34.9 bps on Monday.

The index crossed the 9% year-to-date return threshold on Tuesday only to fall below it on Wednesday.

The CDX High Yield 30 index rose 25 bps to close Thursday at 106.45. The index dropped 34 bps on Wednesday after climbing 29 bps on Tuesday and 39 bps on Monday.

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