Secondary rebounds from March lows; U.S. Steel, PPD, Teleflex trade at steep premiums

By Abigail W. Adams

Portland, Me., May 22 – Trailing a four-day period in which the high-yield primary market saw $9.7 billion of junk-rated, dollar-denominated issuance, the new issue bourse went quiet ahead of Friday's early close.

However, the post-holiday week is expected to be active provided market conditions hold, sources said.

While volume was light during Friday’s abbreviated session, the secondary space closed out the week on firm footing, sources said.

The secondary market continued to rebound from its March lows with spreads reaching new post-March tights over the past week, according to a BofA Global Research report.

New paper continued to dominate activity in the secondary space with United States Steel Corp.’s 12% senior notes due 2025 (B2/B+), Pharmaceutical Product Development’s 5% senior notes due 2028 (B2/B), and Teleflex Inc.’s 4¼% senior notes due 2028 (Ba3/BB) trading with steep premiums in high-volume activity.

While volume was light, Clark Equipment Co.’s new 5 7/8% senior notes due 2025 (Ba3/BB+), Northwest Fiber/Ziply Fiber’s 10¾% senior notes due 2028 (Caa1/CCC), and Cooper-Standard Automotive Inc.’s 13% senior notes due 2024 (B1/B-) were also bid up in the aftermarket.

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