Royal Caribbean, L Brands, Univision bring megadeals; WPX flat; Service Properties soars

By Paul A. Harris and Abigail W. Adams

Portland, Me., June 4 – Thursday was the day of the megadeal in the domestic high-yield primary market.

L Brands, Inc. priced a $1.25 billion two-tranche offering, Royal Caribbean Cruises Ltd. priced a $1 billion issue, and Univision Communications Inc. launched a massively upsized $1.5 billion offering.

While new paper remained in focus and continued to perform well, the secondary space was slightly softer on Thursday with equities weaker on the back of unemployment claims numbers.

There were some “sneaky bids” in the market, a source said. However, nothing traded meaningfully lower.

While the majority of new deals were trading with steep premiums, WPX Energy, Inc.’s 5 7/8% senior notes due 2028 (B1/BB-/BBB-) fell flat in the aftermarket.

TRI Pointe Group Inc.’s 5.7% senior notes due 2028 (Ba3/BB-) and Meritor, Inc.’s 6¼% senior notes due 2025 (B2/BB-/BB-) were well above their issue prices.

However, Service Properties Trust’s 7½% senior notes due 2025 (Baa3/BB+) were the “big winners” with the notes 4 to 5 points above their issue price, a source said.

High-yield mutual and exchange-traded funds reported inflows of $5.746 billion for the week through Wednesday’s close, according to the Refinitiv Lipper US Fund Flows report.

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