Cumulus Media, Outfront Media, Harsco, Aker BP price; Graphic Packaging trades at a premium

By Abigail W. Adams

Portland, Me., June 12 – The domestic high-yield primary market saw another busy session on Wednesday with four deals totaling $2.4 billion pricing – three of which came upsized.

Cumulus Media New Holdings Inc. priced an upsized $500 million offering of seven-year senior secured first-lien notes (B2/B) on Wednesday at par to yield 6¾%, according to a market source.

Outfront Media Capital LLC priced an upsized $650 million offering of eight-year senior notes (expected B1/BB-) at par to yield 5% in a Wednesday drive-by.

Aker BP ASA priced an upsized $750 million offering of five-year senior notes (Ba1/BB+/BBB-) at par to yield 4¾%.

Harsco Corp. priced a $500 million offering of eight-year senior notes (Ba2/BB-/BB) at par to yield 5¾%.

The European primary market also saw some activity with Entertainment One Ltd. starting a roadshow for a £425 million offering of seven-year senior secured notes.

The new paper was in demand during bookbuilding and was trading up in the secondary space with anything deemed low risk, or double B, extremely well bid, a market source said.

However, with focus firmly rooted on the new paper in the works, the secondary space was quiet on Wednesday with the market largely unchanged, another source said.

Graphic Packaging International, LLC’s 4¾% senior notes due 2027 (Ba2/BB+) held onto their premium in the secondary space after a strong start out of the gate on Tuesday.

Cumulus upsizes, prices tight

Cumulus Media priced an upsized $500 million offering of seven-year senior notes (B2/B) on Wednesday at par to yield 6¾%, according to a market source.

Pricing came tight to official talk for a yield in the 7% area, which was in line with initial price talk in the low 7% area, a market source said.

The initial size of the deal was $300 million.

BofA Securities Inc. was the left bookrunner for the Rule 144A for life and Regulation S offering.

Deutsche Bank Securities Inc. and Morgan Stanley & Co. LLC were the joint bookrunners.

Proceeds will be used to repay indebtedness under the company’s term loan.

Aker tighter than talk

Aker BP priced an upsized $750 million offering of five-year senior notes (Ba1/BB+/BBB-) at par to yield 4¾% on Wednesday, according to a market source.

Final terms tightened from the official price talk of 4 7/8% to 5 1/8%, which was in line with initial talk in the low 5% area.

The initial size of the deal was $500 million.

Barclays, BNP Paribas, HSBC and MUFG were global coordinators for the Rule 144A and Regulation S deal.

BMO Securities, Citigroup Global Markets Inc., ING, J.P. Morgan Securities LLC and Wells Fargo Securities LLC were joint bookrunners.

The notes were strong out of the gate and quickly traded up to 101, which is where they were poised to go out, sources said.

With the tight pricing of the notes, sources did not expect to see the notes trade much higher.

Outfront drives-by

Outfront Media priced an upsized $650 million offering of eight-year senior notes (expected B1/BB-) at par to yield 5% in a Wednesday drive-by, sources said.

Official price talk was in the 5 1/8% area.

The deal was upsized from $550 million.

Deutsche Bank Securities Inc., J.P. Morgan Securities LLC, BofA Securities Inc., Credit Suisse Securities (USA) LLC, Morgan Stanley & Co. LLC, Goldman Sachs & Co. LLC, and Wells Fargo Securities LLC are bookrunners for the Rule 144A and Regulation S offering.

Harsco accelerates timing

Harsco priced a $500 million offering of eight-year senior notes (Ba2/BB-/BB) at par to yield 5¾% on Wednesday, according to a market source.

Pricing came in line with official talk in the 5 7/8% area.

Goldman Sachs & Co. LLC (left), Citigroup Global Markets Inc., BofA Securities Inc., BMO Capital Markets Corp., HSBC Securities (USA) Inc., RBC Capital Markets LLC, U.S. Bancorp Investments Inc. and KeyBanc Capital Markets LLC were bookrunners for the Rule 144A and Regulation S for life offering.

Timing of the deal was accelerated with sources expecting it to roadshow through Thursday.

Entertainment One on the road

The European primary market also saw some action during Wednesday’s session with one deal joining the forward calendar.

Entertainment One started a roadshow on Wednesday for a £425 million offering of seven-year senior secured notes, according to a market source.

The roadshow is set to run until Friday with pricing expected thereafter.

JPMorgan (billing and delivery) and BNP Paribas are global coordinators for the Rule 144A and Regulation S deal.

Graphic Packaging at a premium

Graphic Packaging’s newly priced 4¾% senior notes due 2027 maintained their premium in the secondary space.

The notes were strong out of the gate and traded up to 101 bid, 101¼ offered on Tuesday, which is where they remained during Wednesday’s session, a market source said.

The notes saw about $30 million in reported volume heading into market close.

Graphic Packaging priced a $300 million issue of the 4¾% notes at par on Tuesday.

The yield printed at the tight end of yield talk in the 4 7/8% area.

Indexes down

After a strong start to the week, indexes backed off their gains on Wednesday with most ending the day down.

The KDP High Yield Daily index shaved off 7 bps to close the day at 70.09 with the yield now 5.72%.

The index gained 7 bps on Tuesday and rose 29 bps on Monday.

The ICE BofAML US High Yield index dropped below the 9% year-to-date return threshold on Wednesday after briefly crossing it on Tuesday.

The index dropped 11.6 bps with the year-to-date return now 8.93%.

The index gained 13.1 bps on Tuesday and jumped 34.9 bps on Monday.

The CDX High Yield 30 index dropped 34 bps to close Wednesday at 106.20. The index climbed 29 bps on Tuesday and 39 bps on Monday.

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