Junk primary brings $2.35 billion; PBF Energy up on redemption; Tenet, Kinetik under water

By Paul A. Harris and Abigail W. Adams

Portland, Me., June 9 – The high-yield new issue market generated a healthy news volume on Thursday as four issuers, each bringing a single tranche of junk, priced $2.35 billion face amount of new notes.

The flurry of primary market activity came on another heavy day for risk assets with selling in the secondary space accelerating as the 10-year Treasury yield marched higher.

Inflation and recession were once again rattling the market following the European Central Bank’s rate hike announcement and May’s consumer price index report set for release on Friday.

The cash bond market was off ¾ point on Thursday with the ICE BofAML US High Yield index’s year-to-date returns again plummeting past negative 9%.

While the overall market was heavy on Thursday, PBF Energy Inc.’s senior notes were a bright spot in the space with the petroleum refiner’s capital structure gaining after the company called its 9¼% senior secured notes due 2025 (B2/BB).

New and recent issues succumbed to the selling pressure, though, with Tenet Healthcare Corp.’s 6 1/8% senior secured notes due 2030 (B1/BB-/BB-) and Kinetik Holdings LP’s 5 7/8% sustainability-linked senior notes due 2030 (Ba1/BB+/BB+) falling below their issue prices in active trading.

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