CURO, HUB and Nabors price junk; Hertz in focus; Venture Global gains; WMG above issuance

By Paul A. Harris and Abigail W. Adams

Portland, Me., Nov. 18 – CURO Group Holdings Corp., HUB International Ltd. and Nabors Industries, Inc. each sold a single tranche in the high-yield primary market on Thursday.

One deal was upsized, one was downsized and one was accelerated.

Meanwhile, the secondary space was again largely unchanged on Thursday with new and recent deals continuing to dominate the tape.

Hertz Corp.’s two tranches of senior notes (Caa1/B) were in focus with both putting in strong performances in the aftermarket.

Venture Global Calcasieu Pass LLC’s 3 7/8% senior notes due 2033 (Ba3/BB) continued to gain in active trading.

WMG Acquisition Corp.’s 3¾% senior secured notes due 2029 (Ba3/BB+) were also trading at a slight premium to their discounted issue price.

Meanwhile, funds continued to enter the space albeit at a reduced pace with high-yield mutual and exchange-traded funds adding $99 million in the week through Wednesday’s close, according to Refinitiv Lipper Fund Flow Report.

Thursday primary

Nabors Industries sold the largest junk bond deal on Thursday, $700 million of 7 3/8% senior priority guaranteed notes due May 15, 2027 (B3/B-/B), priced at par.

The deal was expected to price on Friday, but timing was accelerated and the deal cleared the market a day ahead of schedule.

The deal that was expected to be the largest, HUB International’s, was downsized by Thursday morning after losing a secured tranche to ultimately price as a single tranche of $550 million of unsecured notes with a 5 5/8% coupon at par (Caa2/CCC+).

The oversubscribed deal moved into the aftermarket with the notes reported to be at par bid, 100½% offered.

The secured tranche was shifted to what ended up being an upsized $1.75 billion term loan.

CURO Group did a modest upsize on a tap of 7½% notes which priced in the middle of talk at 100.5 to yield 7.401% (B3/CCC+).

The deal added $25 million while it was in the market to price at $250 million.

The deal was heard to be clubby, with no one receiving allocations who was not in the original deal, a market source said.

Friday business

One deal joined the calendar on Thursday, as Warrior Met Coal, Inc. announced a new $350 million offer of senior secured notes due 2028.

The new notes are expected to take out the company’s 8% senior secured notes due 2024, with a conditional notice of redemption delivered to existing noteholders.

Goldman Sachs is leading the sale which is announced as Friday business. Post-investor call on Friday morning, the notes are expected to price.

Hertz in focus

In the secondary, Hertz’s recently priced two tranches of senior notes were in focus on Thursday with both putting in strong aftermarket performances.

Hertz’s 5% senior notes due 2029 were changing hands in the par ¾ to 101¼ context throughout the session.

There was more than $140 million in reported volume.

The 5% notes came in slightly from the heights reached after breaking for trade on Wednesday when the notes were marked at 101 bid.

Hertz’s 4 5/8% senior notes due 2026 were largely unchanged on Thursday.

They were changing hands in the par ¾ to 101 context heading into the market close, a source said.

There was more than $75 million in reported volume.

Hertz priced a $500 million tranche of the 4 5/8% notes and a $1 billion tranche of the 5% notes at par in a Wednesday drive-by.

The 4 5/8% notes priced at the tight end of yield talk in the 4¾% area. The 5% notes priced at the tight end of yield talk in the 5% to 5¼% area.

Venture Global gains

Venture Global’s 3 7/8% senior notes due 2033 continued to gain in active trading after a strong break.

The 3 7/8% notes were changing hands in the par ¾ to 101 3/8 context throughout Thursday’s session.

They were marked at par 5/8 bid after breaking for trade.

The notes were performing well despite their low coupon and long duration due to the market’s belief the company may be a rising star.

The liquefied natural gas producer is also from a hot industry and the deal played to heavy demand during bookbuilding, sources said.

Venture Global priced an upsized $1.25 billion, from $750 million, issue of the 3 7/8% notes at par in a Wednesday drive-by.

The yield printed at the tight end of the 3 7/8% to 4% yield talk.

It played to a $3 billion order book, a source said.

WMG at a premium

WMG’s 3¾% senior secured notes due 2029 were trading at a slight premium to their discounted issue price on Thursday.

The notes were changing hands in the 99 3/8 to 99 7/8 context throughout the session.

There was about $21 million in reported volume.

WMG priced a $540 million issue of the 3¾% notes at 99.145 to yield 3 7/8%.

The yield printed at the wide end of yield talk in the 3¾% area.

Indexes

The KDP High Yield Daily index shaved off 2 points to close Thursday at 68.13 with the yield now 3.94%.

The index was down 5 points on Wednesday, 43 points on Tuesday and 14 points on Monday.

The CDX High Yield 30 index slid 2 basis points to close Thursday at 109.17. The index fell 12 bps on Wednesday, was up 4 bps on Tuesday and was flat on Monday.

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