American Greetings on tap; McDermott, Freedom Mortgage price; secondary space ‘contained’

By Paul A. Harris and Abigail W. Adams

Portland, Me., April 4 – Two high-yield deals totaling $2 billion priced on Wednesday with one deal upsized and another downsized. McDermott International Inc. priced its downsized $1.3 billion issue of 10 5/8% six-year senior notes (B2/B-) at 94.75 to yield 11.865% on Wednesday.

The issue size was decreased from $1.5 billion. Freedom Mortgage Corp. priced an upsized $700 million issue of seven-year senior notes (B2/B-) at par to yield 8¼% on Wednesday.

The issue size was increased from $500 million.

While McDermott was not seen trading after pricing late in the afternoon, Freedom Mortgage was active on the tape with the notes seen trading up.

American Greetings Corp.'s $325 million offering of eight-year senior notes (Caa1/CCC+) is expected to price on Thursday after it was initially expected to price on Tuesday.

As volatility roiled equity markets, the high-yield secondary market remained firm with little movement on the morning’s downswing or afternoon’s upswing, a market source said.

While down earlier in the day, California Resources Corp.’s 8% senior secured second-lien notes due 2022 closed the day unchanged, the source said.

While the energy sector in high yields did not see major movements despite the volatility of broader markets, Weatherford International’s 9.875% senior notes due 2024 and 2025 (Caa1/B) were down 1 to 2 points in active trading during Wednesday’s session.

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