Morning Commentary: NortonLifeLock reopens junk primary; market awaits LBO deals

By Paul A. Harris

Portland, Ore., Sept. 7 – The post-Labor Day junk primary market reopened on Wednesday as NortonLifeLock Inc., formerly known as Symantec Corp., rolled out a $1.2 billion two-part offering of senior notes (B1/BB-/BB+) set to price before the end of the week.

The offering includes five-year notes with initial talk in the low-7% area and eight-year notes with initial talk in the 7 3/8% area.

There is $100 million of reverse inquiry in the deal, a sellside source said.

Meantime, the market awaits news on high profile LBO-financing deals from Citrix Systems Inc., Nielsen Holdings and Tenneco Inc., the source said, adding that with the Fed believed to be primed to bring further interest rate increases, investors and issuers are keen to get a fix on the price of syndicating debt related to mergers and acquisitions.

“The Citrix deal should completely reset the market for LBO financing,” the sellsider commented.

Away from the primary market, junk opened unchanged on Wednesday, traders said.

At mid-morning, with the Dow Jones industrial average up 0.85%, the iShares iBoxx $ High Yield Corporate Bd (HYG) share price was up a solid 0.88%, or 65 cents, at $74.75.

The Ford Motor Co. 6.1% senior green notes due August 2032 (Ba2/BB+), which came in a high-profile late-summer transaction, were up ¼ point on the morning, changing hands at 96 5/8 in a round lot trade, the sellsider said, noting that they went out Tuesday at 96 3/8.

The new Ford green bonds came at par on Aug. 16 in a $1.75 billion high-grade-style execution.

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