Ally, Restaurant Brands, Spectrum Brands lead $5.9 billion primary; funds lose $89 million

By Paul A. Harris and Paul Deckelman

New York, May 14 – After four consecutive sessions characterized by only modest new issuance, the high-yield primary sphere exploded into a fireball of virtually non-stop pricing action on Thursday, syndicate sources said.

By the time it was all over, $5.9 billion of new dollar-denominated and fully junk-rated paper had been brought to market by seven issuers in nine tranches.

It was the busiest day in Junkbondland since April 9, when eight issuers priced nine tranches totaling $6.6 billion.

Ally Financial Inc. had the biggest deal of the session, pricing $1.4 billion of notes broken into three- and seven-year tranches. Though junk-rated, the lender’s deal was done off the investment-grade desks.

Restaurant Brands International Inc., the parent company of restaurant chains Burger King and Tim Hortons, served up $1.25 billion of 6.75-year paper.

Secondary market activity was dominated by trading in the new deals, with particularly heavy volume in Restaurant Brands and brisk activity in PPL Energy Supply, LLC, Spectrum Brands Inc., FelCor Lodging LP and CNO Financial Group, Inc.

Statistical market performance indicators were mixed for a second consecutive session on Thursday after having been lower across the board on Tuesday.

Another numerical gauge, the flow of cash into or out of high-yield mutual funds and exchange-traded funds, saw its fourth straight weekly outflow on Thursday. Some $89 million more left those finds than came into them during the most recent reporting week.

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