Edgewell, Cushman & Wakefield, Park Hotels, Talen price; SBA, Clearway Energy add-on

By Paul A. Harris and Abigail W. Adams

Portland, Me., May 19 – New deals totaling $3.1 billion entered the primary high-yield market on Tuesday.

An active and busy market saw deals come from issuers Edgewell Personal Care Co., Cushman & Wakefield, Park Hotels & Resorts Inc. and Talen Energy Supply LLC.

Add-on deals entered the space from SBA Communications Corp. and Clearway Energy Operating LLC.

All of the Tuesday deals were upsized.

Meanwhile, the secondary space was largely unchanged on Tuesday with trading activity continuing to focus on new issues and fallen angels.

Inspire Brands’ newly priced 7% senior notes due 2025 (B3/B) outperformed in the secondary space.

MSCI Inc.’s 3 7/8% senior notes due 2031 (Ba2/BB+) were also trading with a premium.

Live Nation Entertainment, Inc.’s recently priced 6½% senior notes due 2027 (Ba2/BB-) remained active with the notes continuing to gain.

$3.1 billion day

New issue news flow remained steady and strong on Tuesday.

Edgewell Personal Care Co. priced an upsized $750 million issue of eight-year senior notes (Ba3/BB) at par to yield 5½%.

The issue size increased from $600 million.

The yield printed at the tight end of the 5½% to 5¾% yield talk.

Cushman & Wakefield plc priced an upsized $650 million issue of eight-year senior secured notes (Ba3/BB-) at par to yield 6¾%.

The issue size increased from $400 million.

The yield printed in the middle of the 6 5/8% to 6 7/8% yield talk, and tight to the 6¾% to 7% initial talk.

Park Hotels & Resorts Inc. priced an upsized $550 million issue of five-year senior secured notes (B1/BB-) at par to yield 7½%.

The issue size increased from $500 million.

The yield printed in the middle of yield talk in the 7½% area.

SBA Communications Corp. priced an upsized $500 million add-on to its 3 7/8% senior notes due Feb. 15, 2027 (B1/BB-) at 99.5 to yield 3.959%.

The issue size increased from $400 million.

The issue price came at the rich end of the 99 to 99.5 price talk.

Talen Energy Supply LLC price an upsized $400 million issue of 7 5/8% eight-year senior secured notes (Ba3/BB-) at par to yield 7.624%.

The issue size increased from $330 million.

The yield printed 12.6 basis points through the 7¾% to 8% yield talk.

And Clearway Energy Operating LLC priced an upsized $250 million add-on to its 4¾% senior notes due March 15, 2028 (Ba2/BB) at 102.

The issue size increased from $200 million.

The issue price came at the rich end of the 101 to 102 price talk. Initial talk was in the 100.5 area.

The calendar

There were also announcements of deals that will be in the market at least overnight.

Herbalife Nutrition Ltd. and HLF Financing, Inc. plan to price a $600 million offering of 5.25-year senior notes (existing ratings B1/BB-) on Wednesday.

And Cooper-Standard Automotive Inc. plans to price a $250 million offering of four-year senior secured notes on Thursday.

Inspire trades up

Inspire Brands’ 7% senior notes due 2025 were putting in a strong performance in the secondary space.

The notes were quoted at 101¾ bid, 102¼ offered with the majority of trades wrapped around 102, a source said.

The notes were among the notes actively traded in the secondary space with $67 million in reported volume.

The notes from the holding company for fast food chains such as Arby’s, Buffalo Wild Wings, Jimmy John’s and Sonic Drive-In had a nice yield for secured paper, a source said.

Even at their current level, the notes still were still yielding almost 6½%, according to a market source.

Inspire priced an upsized $750 million issue of the 7% notes at par in a Monday drive-by.

The issue size increased from $500 million.

The yield came tight to the 7% to 7¼% yield talk and tighter than initial guidance in the high 7% area.

MSCI at a premium

MSCI’s 3 7/8% senior notes due 2031 were also trading at a premium in high-volume activity, despite their tight pricing and long maturity.

The notes were quoted at par ¾ bid, 101 offered, a market source said.

More than $38 million of the bonds were on the tape by the late afternoon.

The American finance company priced an upsized $1 billion issue of the 3 7/8% notes at par in a Monday drive-by.

The issue size increased from $800 million.

The yield printed in the middle of yield talk in the 3 7/8% area and tight to initial talk in the 4% area.

Live Nation up again

Live Nation’s 6½% senior notes due 2027 continued to gain in high-volume activity.

The 6½% notes rose another ½ point to trade up to a 104-handle on Tuesday, a market source said.

The bonds had more than $45 million in reported volume by the late afternoon.

While the event promoter and venue operator’s business has been sidelined due to the coronavirus, investors were optimistic about its ability to recover, a source said.

The company has enough liquidity to survive in the near term, a source previously said.

Live Nation priced a $1.2 billion issue of the 6½% notes at par on May 13.

Monday inflows at $1.03 billion

High-yield ETFs saw a whopping $1.03 billion of daily cash inflows on Monday, the most recent session for which data was available at press time, according to a market source.

With actively managed high-yield funds seeing $100 million of inflows on Monday, the combined fund flows were positive-$1.13 billion, the source said.

The combined funds are tracking $1.16 billion of inflows for the week that will conclude with Wednesday's close, according to the market source.

Indexes mixed

Indexes were mixed on Tuesday after launching the week on strong footing.

The KDP High Yield Daily index gained 22 basis points to close Tuesday at 63.04 with the yield now 7.44%.

The index was up 45 bps on Monday.

The ICE BofAML US High Yield index dropped 28 bps with the year-to-date return now negative 8.546%.

The index jumped 103.5 bps on Monday.

The CDX High Yield 30 index shaved off 20 bps to close Tuesday at 94.06.

The index jumped 166 bps on Monday.

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