Hub drives by with secured deal, bonds climb; recent deals strong; Centene megadeal ahead

By Paul Deckelman and Paul A. Harris

New York, Jan. 27 – Another day, another deal for the high-yield market.

The junk bond primary arena – which finally began pricing new issues again about a week ago, following a 10-day layoff during a period of intense market volatility – churned out its fifth offering in as many sessions on Wednesday, when Hub International Ltd. came to market with $300 million of five-year secured paper.

As has been the case with all of those recent deals, the quick-to-market transaction was well oversubscribed, and the new bonds were seen having firmed smartly in initial aftermarket dealings.

Traders meantime saw continued strength in recently priced credits from GFL Environmental Corp., Lamar Advertising Co., GCP Applied Technologies Inc. and TreeHouse Foods, Inc. All of them continued to trade at solid premiums to their respective par issue prices, with GFL and Lamar in particular showing notable volume.

Away from the deals that have already priced, primaryside sources said that Centene Corp.’s pending $2.27 billion two-part offering is continuing to pick up steam, with pricing expected in the late part of the week. Barring the unlikely surprise appearance of a huge, quickly shopped offering from another issuer in the interim, the Centene deal will be the biggest issue to hit the high-yield market so far in the new year.

Statistical measures of junk market performance turned mixed on Wednesday after having been higher across the board on Tuesday.

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