Bruin, Ashtead price; LifePoint Health jumps; Petrobras, Intelsat mixed; IHS Markit notes still in view

By James McCandless and Paul A. Harris

San Antonio, July 23 – The high-yield primary market saw one new deal price, as well as one crossover new deal on Monday, while the secondary market saw robust volume to start the week in trading.

Houston-based energy exploration and production company Bruin E&P Partners LLC priced a $600 million issue of five-year senior notes (B3/B+) at par to yield 8 7/8%.

The yield printed in the middle of the upwardly revised 8¾% to 9% yield talk.

In the crossover market, London-based international equipment rental company Ashtead Group plc priced an upsized $600 million issue of split-rated eight-year second priority senior secured notes (Ba2/BBB-) at par to yield 5¼% in a quick-to-market Monday trade.

LifePoint Health Inc.’s 5.375% and 5.875% senior notes saw multi-point gains after news of being bought by Apollo Global Management.

Petrobras Global Finance BV’s 8¾% notes due 2026 and 7 3/8% notes due 2027 were mixed as oil futures declined.

Intelsat SA notes were mixed again as the Federal Communications Commission considers a joint proposal from satellite firms.

IHS Markit Ltd.’s senior notes remained in focus at the start of the week.

Restructured Bruin prices

In Monday's primary market Bruin E&P Partners LLC priced a $600 million issue of five-year senior notes (B3/B+) at par to yield 8 7/8%.

The yield printed in the middle of the upwardly revised 8¾% to 9% yield talk. Previous official talk was 8¼% to 8½%. The deal widened significantly since it came into the market early in the week of July 16 with initial guidance of 7½ % to 7¾%.

In a restructuring, the tenor of the notes was decreased to five years from eight years, and the first call premium was increased to 75% of the coupon from 50%.

Pricing was delayed. The deal had been expected to clear the market last Friday, but was held over the weekend.

There were also covenant changes.

J.P. Morgan, Barclays, BMO, BOK, Capital One, Citigroup, Fifth Third, MUFG, RBC and TD were the joint bookrunners.

The Houston-based energy exploration and production company plans to use the proceeds to repay debt under its term loan and revolving credit facility, as well as to fund a dividend to its sponsor, ArcLight Capital Partners.

Ashtead upsized drive-by

In the crossover market Ashtead Group plc priced an upsized $600 million issue of split-rated eight-year second priority senior secured notes (Ba2/BBB-) at par to yield 5¼% in a quick-to-market Monday trade.

The issue size was increased from $500 million.

The yield printed at the tight end of the 5¼% to 5 3/8% yield talk. Initial guidance had the deal coming with a yield of 5¼% to 5½%.

JP Morgan, BofA Merrill Lynch, Citigroup, Wells Fargo, Barclays, HSBC, Lloyds, MUFG, NatWest, Santander and SunTrust were the joint bookrunners.

Proceeds, including the additional proceeds resulting from the $100 million upsizing of the deal, will be used to repay debt under the revolving credit facility.

Intrepid Aviation three-year deal

Intrepid Aviation Group Holdings, LLC and Intrepid Finance Co. started a roadshow on Monday $515 million offering of three-year senior notes.

The debt refinancing deal is set to price late in the July 23 week.

Initial guidance has the notes coming in the 6¼% area.

Jefferies is the left bookrunner.

Hi-Crush 8½% area

Hi-Crush Partners LP expects to price a $450 million offering of eight-year senior notes during the July 23 week.

The deal is in the market with initial guidance in the 8½% area.

JP Morgan Securities LLC is leading the offer.

The Houston-based provider of proppant and logistics solutions to the oil and gas industry plans to use the proceeds to refinance its term loan, as well as to fund the cash portion of the FB Industries Inc. acquisition, and for general partnership purposes.

Party City starts Tuesday

Party City Holdings Inc. plans to start a roadshow on Tuesday for a $500 million offering of eight-year senior notes.

Goldman Sachs is the left bookrunner.

The Elmsford, NY-based party goods retailer plans to use the proceeds to repay $90 million under its ABL facility and $400 million of term loan debt.

LifePoint bought

Brentwood, Tenn.-based rural hospital operator LifePoint notes jumped in the secondary space after reports confirmed that it is being acquired by Apollo Management Group for $5.6 billion.

“Those bonds are moving like they’re going to be taken out of the market,” a trader said. “There wasn’t much movement in them recently but they’ve really improved today.”

The 5 3/8% notes due 2024 gained about 6¼ points to close at around 103 bid. The 5 78% notes due 2023 rose about 2½ points to close at around 103 bid.

Petrobras mixed

Petrobras Global Finance, a Rotterdam, Netherlands-based subsidiary of Rio de Janeiro-based oil and gas giant Petrobras, saw issues mixed to start the week as West Texas crude oil futures slipped.

The 8¾% notes due 2026 traded up about 1¼ points to close at around 112¼ bid.

The 7 3/8% notes due 2027 lost about 1¼ points to close at around 103 bid.

Intelsat mixed

Luxembourg-based satellite communications company Intelsat notes were mixed. The FCC announced recently that it would consider a rule change allowing mobile providers to access airwaves currently restricted to traditional broadcasters and managed by satellite firms, potentially opening up a new revenue stream for satellite firms.

The Intelsat (Luxembourg) SA 7¾% notes due 2021 were level at 94¼ bid. The 8 1/8% notes due 2023 shaved off about 2 points to close at around 82½ bid.

IHS Markit

IHS Markit priced $500 million of 4.125% five-year notes at 99.707 to yield 4.19%, or a spread of Treasuries plus 145 basis points on Thursday.

The company also priced $750 million of 4.75% 10-year notes at 99.628 to yield 4.797%, or a spread of Treasuries plus 195 bps.

The bonds continued to generate interest, a trader said, continuing to float around par.

The 4.125% senior notes due 2023 rose about ¼ point to close at around 99.9 bid after they were seen trading at 99.824 on Friday.

The 4.75% notes were spotted trading around 99.13 bid after going as low as 99.581 bid on Friday.

Indexes mixed

Three high-yield secondary benchmarks started the week veering in different directions.

The KDP High Yield index was down 2 basis points to close Monday at 70.38 with the yield at 5.88%. The index had spent last week bouncing up and down with the index up 1bs on Friday, down 1 bps on Thursday, up 1 bps on Wednesday and up 1 bps on Tuesday.

The Merrill Lynch High Yield index rose again. The index was up 5.8 bps on Monday with the year to date return at 0.745%, marking the twelfth consecutive rise after moving into the black on July 6.

The index was up 3.5 bps on Friday and 2.4 bps on Thursday.

The CDX High Yield 30 index was up 2.8 basis points on Monday to close at 106.737 following a 2 bps gain on Friday and a 17 bps loss on Thursday.

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