Triumph Group, Live Nation deals drive by; Post, DriveTime, Interface slate; Dish busy on rival's news

By Paul Deckelman and Paul A. Harris

New York, May 19 - The high-yield primary arena saw the new week begin on a quiet note on Monday.

High-yield syndicate sources saw two quickly shopped deals totaling $550 million price, while secondary traders saw some of the lightest volume flows seen in recent weeks.

"It's almost as if everyone decided to take this week off," one trader observed, rather than the traditional last week in May following the Memorial Day observance next Monday.

The syndicate sources said that Triumph Group, Inc., a Berwyn, Pa.-based aircraft components manufacturer, did a quick-to-market $300 million offering of eight-year notes, which was later seen having gained about a point in light aftermarket trading.

Live Nation Entertainment, Inc., a Los Angeles-based promoter of concerts and other live entertainment events and seller of tickets to entertainment and sporting events, drove by with a $250 million eight-year deal that came too late in the session for any immediate aftermarket activity.

Besides the deals that priced, the sources said several other offerings were announced or otherwise surfaced on the radar screens.

Breakfast cereal producer Post Holdings, Inc. started a roadshow for its $630 million of eight-year notes, which is expected to price late in the week. Also hitting the road, security systems provider Interface Master Holdings, Inc. was seen with a $100 million offering of four-year contingent cash-pay notes, which may price around mid-week. And used-car dealership operator DriveTime Automotive Group, Inc. was heard to be bringing a $400 million seven-year note issue to market this week.

Away from the new-deal realm, traders said that the market was painfully quiet, with light volume.

One credit seeing a fair amount of activity was Dish DBS Corp., presumably driven by renewed investor interest in the satellite television sector in the wake of the weekend announcement that telecommunications giant AT&T will acquire Dish competitor DirecTV.

Statistical market performance indicators were mixed for a second consecutive session on Monday; they had turned mixed on Friday, after having been lower across the board on Thursday.

Triumph at the tight end

The dollar-denominated primary market saw two deals price on Monday for an overall total of $550 million.

Both came in drive-bys and priced at the tight end of talk. Neither was upsized.

Triumph Group priced a $300 million issue of eight-year senior notes (Ba3/BB-) at par to yield 5¼%.

The yield printed at the tight end of yield talk in the 5 3/8% area.

J.P. Morgan, RBC and UBS ran the books for the debt refinancing.

Live Nation drives through

Live Nation priced a $250 million issue of eight-year senior notes (B3/B+) at par to yield 5 3/8%.

The yield printed at the tight end of yield talk in the 5½% area.

Goldman Sachs, J.P. Morgan, BofA Merrill Lynch, HSBC, Morgan Stanley, RBS, Wells Fargo and Scotia were the managers for the offering.

The Los Angeles-based live entertainment company plans to use the proceeds, along with proceeds from a $250 million offering of convertible senior notes due 2019, to redeem all of its outstanding 2 7/8% convertible senior notes due 2027, as well as to reinvest in the company's core business and for general corporate purposes, including potential acquisitions.

24 Hour Fitness talk

24 Hour Fitness Worldwide Inc. talked its $500 million offering of eight-year senior notes (expected ratings Caa1/CCC+) to yield 8% to 8¼%, on top of initial guidance.

Books closed on Monday, and the deal is set to price on Tuesday.

J.P. Morgan, Deutsche Bank and Morgan Stanley are the joint bookrunners.

Post Holdings buyout deal

The forward calendar saw a meaningful buildup across several currencies on Monday.

In the dollar market, Post Holdings kicked off a $630 million offering of senior notes due Dec. 15, 2022.

The joint high-yield and equity roadshow has stops in New York City on Tuesday and Boston on Wednesday.

Joint bookrunner Barclays will bill and deliver. Credit Suisse, Wells Fargo, Goldman Sachs, BMO and Nomura are also joint bookrunners.

The St. Louis-based consumer packaged goods holding company plans to use the proceeds, along with a $635 million credit facility and $500 million of equity, to fund its acquisition of MFI Holding Corp. (Michael Foods), a Minnetonka, Minn.-based producer and distributor of food products.

DriveTime's $400 million

DriveTime Automotive and DT Acceptance Corp. plan to price a $400 million offering of senior secured notes due 2021 (expected ratings B3/B) during the middle part of the present week.

Wells Fargo is the left bookrunner for the debt refinancing deal. Citigroup and Deutsche Bank are the joint bookrunners.

Interface Security roadshow

Interface Master Holdings, the holding company for Interface Security Systems Holdings and Interface Security Systems, LLC, began a roadshow on Monday for its $100 million offering of contingent cash-pay notes due 2018 (/CCC/).

The deal is also expected to price during the middle part of the present week.

Imperial Capital is the bookrunner.

The Earth City, Mo.-based provider of physical security and secured managed network services plans to use the proceeds for general corporate purposes and to fund a debt service reserve account.

Galapagos's €775 million deal

The euro- and sterling-denominated markets generated news on Monday.

A roadshow starts on Tuesday for Galapagos Holdings SA's €775 million three-part offering of high-yield notes.

The deal will help to finance Dusseldorf, Germany-based GEA Group AG's spinoff of its heat exchangers business to Triton Advisers Ltd. It comes structured as a €525 million two-part offering of seven-year senior secured notes, including floating-rate notes and fixed-rate notes.

Tranche sizes remain to be determined.

The financing also includes a €250 million offering of eight-year senior unsecured fixed-rate notes.

Joint bookrunner Deutsche Bank will bill and deliver. Commerzbank, ING, RBC, Royal Bank of Scotland and UniCredit are also joint bookrunners.

Xella starts roadshow

Xella International SA began a roadshow for a €325 million offering of five-year senior secured floating-rate notes.

The roadshow wraps up on Wednesday.

Joint global coordinator BNP Paribas will bill and deliver for the debt refinancing. Goldman Sachs is also a joint global coordinator. Credit Agricole, Morgan Stanley and UniCredit are joint bookrunners.

Brake Bros two-part deal

Brakes Bros Ltd. launched a two-part offering of senior secured notes (expected ratings B3/B-).

A roadshow will follow, with stops in London on Tuesday and in Edinburgh on Wednesday.

The deal is coming in the form of a £260 million add-on to the Brakes Capital 7 1/8% senior secured notes due Dec. 15, 2018 and a €150 million of new senior secured floating-rate notes.

Joint bookrunner Barclays will bill and deliver for the bank debt refinancing deal. HSBC and JPMorgan are also joint bookrunners.

A quiet day

Traders said that Junkbondland was one very quiet place on Monday.

"It was kind of dead today," said one trader who saw little or nothing going on even in recently priced issues, such as Friday's offering from Teleflex Inc. or Thursday's two-part megadeal from CommScope Inc.

A second trader, who also didn't see any dealings in the recently priced issues, opined, "Volume is about as low as I've seen it." He also saw quiet conditions in the equity markets.

Not only did he not see any of last week's new issues trading around, but "I didn't see much of anything trading. We traded some secondary names on a couple of 'offer-wanted' lists and that was about it."

He further noted that the Trace bond tracking system was only showing about $875 million of paper having changed hands by around 4:30 p.m. ET, which was maybe about half the usual turnover.

Triumph is a winner

Among specific issues, a trader pegged the new Triumph Group 5¼% notes due 2022 in a 100¾ to 101¼ context The aircraft components manufacturer "traded at 101 a few times," he said.

A second trader also saw those new notes having pushed up to 100¾ bid, 101 offered.

However, a third trader said that he saw no signs of trading in that new deal.

Triumph's existing 4 7/8% notes due 2021 were, meanwhile, seen among the most active issues in the secondary realm, with over $12 million having traded, going home at 98¾ bid.

The bonds were well down from the 101 to 101¼ bid area at which those '21s had closed out last week, although a market source pointed out that those higher trades had mostly been smallish and unrepresentative odd lots. On a round-lot basis, the bonds were actually up by around 1/8 of a point.

Market participants, meanwhile, said that Live Nation's new 5 3/8% notes due 2022 priced too late in the day on Monday and were not seen trading around immediately afterward.

Recent deals mostly steady

One trader did see some activity in some of new deals that had priced last week.

For instance, he said that Group 1 Automotive, Inc.'s 5% notes due 2022 were up about ¼ of a point on the day, to 100½ bid, 101.

The Houston-based auto dealership and collision services center chain priced $350 million of the notes at par on Friday, after upsizing that scheduled forward-calendar transaction from $300 million originally. The new bonds had gained about ¼ of a point in initial secondary dealings.

Atlas Resource Partners, LP's $100 million add-on to its 7¾% notes due 2021 was off ¼ of a point at 99½ bid, 100½ offered.

The Pittsburgh-based oil and natural gas exploration and production company priced its quickly shopped add-on to the existing bonds at 99.5 to yield 7.846%. It firmed slightly from their issue price, ending Friday at 99¾ bid, 100½ offered.

The bonds were actually issued by the company's Atlas Energy Holdings Operating Co. LLC and Atlas Resource Finance Corp. entities.

The trader saw just small changes in the levels for CommScope's $1.3 billion two-tranche deal, which came to market on Thursday as a drive-by offering.

The Hickory, N.C.-based provider of communications infrastructure services priced $650 million of 5% notes due 2021 and $650 million of 5½% notes due 2024, both at par, after each tranche was upsized from an originally announced $550 million.

The 5% notes were trading around 100¾ bid, 101 offered, up 1/8 point from Friday's late levels.

The 51/2s were finishing the day at 100 5/8 bid, 100 7/8 offered, also up 1/8 point.

One recent deal, which did have a more pronounced price movement, was Teleflex's 5¼% notes due 2024. It come to market too late in the day on Friday for any trading at that time. The notes finally begin trading a little on Monday, with a trader quoting the bonds at 101½ bid, 102 offered.

The Limerick, Pa.-based surgical equipment manufacturer priced $250 million of the notes at par in a same-day transaction.

Dish trades actively

Away from the new deals, traders saw a fair amount of activity on an otherwise mostly quiet day in Dish DBS Corp.'s bonds.

The company's busiest issue of the day was its 5% notes due 2023, with over $21 million of the Englewood, Colo.-based satellite television broadcaster's paper having changed hands.

A trader quoted those bonds going home at 103 bid, calling that down 1/8 of a point. A second trader located the bonds at 103 1/8 bid, calling them up 1/16 of a point on the day.

The Dish bonds were moving around amid the news that the company's larger rival, DirecTV, had agreed to be acquired by phone giant AT&T in a $45 billion transaction.

El Segundo, Calif.-based DirecTV's investment-grade rated 4.6% notes due 2021 tightened to a spread of 52 basis points over comparable Treasuries from pre-news spreads in the lower 70s.

Indicators remain mixed

Statistical junk performance indicators were seen by market sources as mixed for a second consecutive session on Monday. They had turned mixed on Friday, after being lower across the board on Thursday.

The Markit Series 22 CDX North American High Yield index continued to move within a very narrow range, easing by 1/32 of a point on Monday to end at 106 25/32 bid, 106 27/12 offered. On Friday, it had edged upward by that same 1/32 of a point, after having been off for the previous two sessions.

The KDP High Yield Daily index rose by 3 basis points to end Monday at 74.96. On Friday, it had dipped by 2 bps, its second straight downturn. Its yield, meanwhile, came in by 1 bp for a second consecutive session, closing at 5.08%.

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