Priced To Perfection? Ziggo, Dunkin' Brands Leveraged Loans Cool In Trading Mart

Feb 7 2014, 5:13pm CST | by

Shortly after BB-/Ba3 Ziggo‘s $2.35 billion term loan strip broke for trading late this morning, bids for the loan (L+275, 0.75% LIBOR floor) dipped below its 99.75 issue price. After opening into a 99.75/100 market, the paper cooled to a 99.375/99.75 context and was said to have traded below its OID.

Ziggo’s lackluster aftermarket performance isn’t specific to the credit itself – though the company is making its debut in the U.S. institutional loan market, the Dutch cable concern has long been a well-regarded issuer in Europe, and Liberty Global is a well-known entity in the U.S. – but instead comes amid a building resistance to aggressively priced deals following the recent pullback in the secondary.

In addition to its low coupon and nearly eight-year tenor, Ziggo’s loan doesn’t fund immediately. A ticking fee of 50% of the drawn spread kicks in after 31 days, rising to the full margin after 106 days. The $2.35 billion loan is split among three tranches that trade as a strip – an $869 million B-1 term loan, a $560 million B-2 term loan and a $921 million B-3 term loan – that have identical terms but will fund at different times.

Ziggo isn’t the only recent new issue bid below its issue price. B+/B2 Dunkin’ Brands’ $1.379 billion B-4 term loan due 2021 (L+250, 0.75% floor), has cooled to 99.5/99.75, versus issuance at 99.75 on Friday, while BB+/Ba1 TCW Group’s repriced term loan due 2020 (L+225, 0.75% floor) has slid to 99.75/100.25, from issuance at par last week.

With secondary prices off the year’s highs and the recent volatility slowly beginning to creep into the new-issue market, repricing activity has slowed in recent days and it isn’t smooth sailing for every deal already out there. As reported, B/B2 ADS Waste yesterday lifted the spread on its proposed repricing of its term loan by 25 bps, to L+300, while B+/B2 Ineos’ proposed repricing of its term loan due 2018 – which is talked at L+250-275, with a 0.75% floor and a par offer price – is said to be facing some pushback from lenders.

This is not to say that the repricing train has stalled out, or that the market won’t see another reverse-flex. Rather it appears, at least for the time being, that there isn’t much room left to tighten after yields snapped tighter last month courtesy of lopsided technicals. Indeed, for the first time this year, the average single-B new-issue yield rose this week to 4.76%, from 4.61% the previous week. – Kerry Kantin

Source: Forbes Business


Don't miss ...


<a href="/latest_stories/all/all/30" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.


blog comments powered by Disqus

Latest stories

China pledges $81 mn financial assistance for Afghanistan
Beijing, Oct 31 (IANS) China Friday pledged to provide non-reimbursable assistance of 500 million yuan (about 81 million dollars) to Afghanistan this year at an international meeting on Afghanistan held here.
EU seeks talks with Russia over goods duties: WTO
Geneva, Oct 31 (IANS) The European Union (EU) has sought a consultation with Russia over the tariffs the latter imposed on certain agricultural and manufactured goods, the World Trade Organisation (WTO) said Friday.
Virgin Galactic's spaceship crashes during test flight
Los Angeles, Nov 1 (IANS) A passenger rocket plane developed by Virgin Galactic's crashed Friday after suffering an "in-flight anomaly" during a powered test flight over the US state of California, the company said.
Bhopal fugitive Warren Anderson is dead (Roundup, Changing dateline)
Washington, Oct 31 (IANS) Warren Anderson, the former CEO of Union Carbide Corp, has died at 92 after living for 30 years under the shadow of the 1984 Bhopal gas tragedy that killed thousands.

Latest from the Network

Arnold Schwarzenegger 'knew' he'd star in another Terminator movie
Arnold Schwarzenegger ''always knew'' he'd star in another 'Terminator' movie. The 67-year-old actor - the former governor of California - insists he wasn't surprised when he got a call from producers to appear in the...
Read more on Movie Balla
Anne Hathaway would 'love' a sequel to The Devil Wears Prada
Anne Hathaway would ''love'' to appear in a sequel to 'The Devil Wears Prada'. The Oscar-winning actress starred in the popular 2006 comedy-drama, which also featured Meryl Streep and Emily Blunt, and has revealed she...
Read more on Movie Balla
Lily Aldridge wearing mother's Playboy costume for Halloween
Lily Aldridge will wear her mother's old Playboy costume for Halloween. The 28-year-old model - who is married to Kings of Leon singer Caleb Followill - found her mum Laura Lyons' raunchy Playboy Bunny flight attendant...
Read more on Celebrity Balla
Rochelle Humes' daughter loves Marvin doll
Rochelle Humes is embarrassed by her daughter's obsession with a doll of her husband, Marvin Humes. The 25-year-old singer has admitted she found it ''cringey'' when she was recently photographed holding a doll of her...
Read more on Celebrity Balla
Keira Knightley annoyed Chloe Moretz didn't ask her advice
Keira Knightley was annoyed Chloe Grace Moretz didn't want her advice. The 29-year-old actress - who appears alongside the 17-year-old star in her latest movie 'Say When' - was disappointed that the young actress didn'...
Read more on Celebrity Balla
Daniel Radcliffe loses everything
Daniel Radcliffe loses everything. The 'Horns' star admits he constantly has to replace his mobile phone and often puts things away and can't ever find them again. The 25-year-old actor said: ''I lose things a lot. At...
Read more on Celebrity Balla
Apple Outsmarts Samsung in Terms of Revenue Generation
Samsung can sell more products, but it doesn’t mean that it will earn more profit, as Apple overtakes the Korean giant with respect to the earnings.According to the Cult of Mac, Samsung earned a profit of $3.8 billion...
Read more on Apple Balla
Apple Declares Not to Remove PCalc iOS Calculator Widget
The PCalc iOs calculator widget is free from the risk of being removed, as Apple decides not to drop it from the App Store.According to Tech Crunch, the officials of Apple have confirmed about the move, stating that it...
Read more on Apple Balla
Seth Rogen to Act as Steve Wozniak in the Steve Jobs’ Movie
Seth Rogen has got an important role in the biopic of the late Apple co-founder Steve Jobs, as he has been selected to play as Steve Wozniak.According to the Variety, Rogen will be advised directly by Steve Wozniak, the...
Read more on Apple Balla
Ponzy schemer cheats residents of $22 mn, gets 15-year jail
Washington, Oct 31 (IANS) If you have been one of those approached by some 'known' person for investing in something with an assurance of 'easy money', you may benefit reading about this Ponzi schemer jailed in the US...
Read more on Politics Balla