Morning Commentary: CDK to price $500 million in Monday drive-by; forward calendar builds

By Abigail W. Adams

Portland, Me., June 4 – After a sluggish week last week, the domestic and European high-yield primary market was in high gear on Monday with one deal set to price in a drive-by and the forward calendar filling in.

CDK Global, Inc. plans to price a $500 million offering of eight-year senior notes in a drive-by on Monday with initial guidance in the 6% area, according to a market source.

The deal is being marketed via an investor call.

J.P. Morgan Securities LLC, BofA Merrill Lynch, Morgan Stanley & Co. LLC, MUFG, U.S. Bancorp Investments Inc. and Wells Fargo Securities LLC are bookrunning managers for the registered deal.

Aleris International, Inc. launched a $400 million offering of five-year senior secured junior priority notes with pricing expected at the end of the week, according to a market source.

The deal is being marketed via an investor conference call, which is scheduled for Tuesday.

Deutsche Bank Securities Inc. is the left lead for the Rule 144A and Regulation S deal. Barclays, BofA Merrill Lynch and JPMorgan are also bookrunners.

Frontera Energy Corp. launched an offering of $500 million five-year senior notes in a Rule 144A and Regulation S deal, according to a company news release.

Matterhorn Telecom SA began a roadshow on Monday for a CHF 2.09 billion equivalent offering of senior secured notes in four tranches (expected B2/B+), according to a market source.

The roadshow will run in Europe and the United States until Thursday with pricing expected thereafter.

Credit Suisse is left lead and Goldman Sachs and Societe Generale are global coordinators. BNP Paribas, JPMorgan and Natixis are joint bookrunners for the Rule 144A and Regulation S deal.

The offering will consist of a €100 million tranche of seven-year notes that are non-callable for one-year, a CHF 150 million tranche of seven-year notes that are non-callable for three-years, a €100 million tranche of eight-year notes that are non-callable for three-years and a $150 million tranche of eight-year notes that are non-callable for three years.

In the European market, Outokumpu Oyj plans to start a roadshow on Tuesday for an offering of €250 million of six-year senior secured notes (expected Ba3), according to a market source.

BNP Paribas and Nordea are coordinators and joint lead managers for the Regulation S deal. Danske Bank and Swedbank are also joint lead managers.

Vivat NV mandated Deutsche Bank, NatWest Markets, ABN Amro, and BNP Paribas to arrange a series of investor meetings in Europe with an issue of euro-denominated perpetual callable restricted tier 1 notes to follow, according to a market source.

Deutsche Bank and NatWest are structuring advisers and lead managers with ABN Amro and BNP.

Meetings are scheduled to begin on Wednesday for the Regulation S offering.

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