Performance Food, VMED price; forward calendar grows; Seaspan, Masonite, Jaguar in focus

By Paul A. Harris and Abigail W. Adams

Portland, Me., July 12 – The high-yield new-deal machines on both sides of the Atlantic roared into mid-July with multiple deal announcements in New York and London on Monday.

McGraw-Hill Education, Inc. came with the highest profile announcement, $2.025 billion of junk in two tranches.

Two issuers priced $1.55 billion face amount of paper in Monday drive-bys.

Performance Food Group priced an upsized $1 billion issue.

VMED O2 UK Financing I plc priced a $550 million green-bond add-on.

Meanwhile, it was a quiet day in the secondary space with the market unchanged amid light volume.

With the primary market returning to action, new paper once again dominated the tape.

Seaspan Corp.’s 5½% senior notes due 2029 remained in focus with the notes continuing to trade with the large premium reached after breaking for trade.

Masonite International Corp.’s 3½% senior notes due 2030 (Ba1/BB+) and Jaguar Land Rover Automotive plc’s 5½% senior notes due 2029 (B1/B) were also active with the notes holding their premiums.

Primary roars to life

McGraw-Hill Education came with the highest profile announcement, $2.025 billion of junk in two tranches.

A roadshow for the deal, backing the LBO by Platinum Equity, is set to begin on Wednesday.

The deal features $1.15 billion of seven-year senior secured notes with initial guidance in the low 5% area, and $875 million of eight-year senior unsecured notes with initial guidance in the low 7% area.

Two issuers priced $1.55 billion face amount of paper in Monday drive-bys.

Performance Food Group priced an upsized $1 billion issue (from $780 million) of 4¼% eight-year senior notes (B2/B+) at par, tight to talk.

The deal was heard to be half done in reverse inquiry, ultimately playing to an order book sized at $2 billion.

Also VMED O2 UK Financing I plc priced a $550 million add-on to its 4¾% senior secured green bonds due July 15, 2031 (Ba3/BB-) at 100.75 to yield 4.655%.

$487 million Friday outflows

The dedicated high-yield bond funds sustained $513 million of net outflows on Friday, the most recent session for which data was available at press time, according to a market source.

The high-yield ETFs saw chunky outflows of $513 million on the day.

Actively managed high-yield funds were slightly positive on Friday, posting $26 million of inflows on the day

Seaspan in focus

Seaspan’s 5½% senior notes due 2029 remained in focus on Monday with the notes continuing to trade with the large premium reached after breaking for trade.

The 5½% notes continued to trade in the par ¾ to 101¼ context and stood poised to close the day at 101, according to a market source.

There was more than $56 million on the tape.

Seaspanp riced an upsized $750 million, from $500 million, issue of the 5½% notes at par on Friday.

The yield printed at the tight end of the 5½% to 5¾% yield talk.

At a premium

While unchanged on Monday, Masonite’s 3½% senior notes due 2030 maintained the premium reached after breaking for trade last Friday.

The 3½% notes closed the day at par ¾, according to a market source.

There was more than $36 million in reported volume.

Masonite priced an upsized $375 million, from $300 million, issue of the 3½% notes at par.

The yield printed at the tight end of yield talk in the 3 5/8% area.

Jaguar’s 5½% senior notes due 2029 were also unchanged although they continued to trade with a large premium.

The 5½% notes closed the day at 101, according to a market source.

There was more than $26 million on the tape.

Jaguar priced a $500 million tranche of the 5½% notes at par last Friday as part of a dual-tranche offering.

The yield printed in the middle of yield talk in the 5½% area.

The deal also included a €500 million tranche of seven-year notes that priced at par to yield 4½%.

Indexes mixed

The KDP High Yield Daily index shaved off 1 point to close Monday at 70.34. However, the yield was flush with last Friday’s close at 3.63%.

The CDX High Yield 30 index shaved off 5 bps to close Monday at 110.

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