Morning Commentary: Vista Outdoor upsizes notes to $350 million; Party City remains well bid

By Paul A. Harris

Portland, Ore., Aug. 6 – The new Party City 6 1/8% senior notes due Aug. 15, 2023 (B3/CCC+) remained well bid on Thursday, sources said, following a spate of deals that drove Wednesday dollar-denominated issuance to its highest volume in over two weeks.

The notes, which were 101¼ bid, 101¾ offered heading into the late morning, were highly active on Wednesday but had quieted down a bit on Thursday, a trader remarked.

The $350 million deal came at par on Wednesday.

Among other Wednesday issues, the First Data Corp. 5 3/8% first-lien senior secured notes due Aug. 15, 2023 (B1/BB-/BB) were par 1/8 bid, par 3/8 offered, heading into the late morning.

The deal, which came at par on Wednesday, was massively upsized to $1.21 billion from $675 million.

There was a buzz in the market that the new First Data notes were priced on the screws and that a lot of investors received full allocations due to the massive upsizing.

Energy names lower

With the barrel price of West Texas Intermediate crude oil down 70 cents heading into mid-morning, high-yield energy names were lower, sources said.

The benchmark California Resources Corp. 6% senior notes due Nov. 15, 2024 were down a solid 2 points on the day, at 76¼, bid 77¼ offered, a trader said.

The RSP Permian, Inc. add-on to its 6 5/8% senior notes due Oct. 1, 2022 (B3/B-) was hanging around in the vicinity of its reoffer price, at 99¼ bid, par offered.

The upsized $200 million deal priced at 99¼ to yield 6.757% on Wednesday.

New deals on deck

In the primary market Vista Outdoor, Inc. upsized its offering of eight-year senior notes (Ba3/BB+) to $350 million from $300 million.

The deal, set to price Thursday, is going well and playing to an order book that is two-times oversubscribed, a trader said.

And Mohegan Tribal Gaming Authority plans to price an $85 million add-on to its 9¾% senior notes due 2021 on Thursday.

At mid-morning the market awaited official price talk; however, the deal is whispered at 102.5 to 103, the source said (see related stories in this issue).

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