Primary at $8 billion: Tegna, Level 3 upsize; Beazer Homes, WPX, Extended Stay active

By Cristal Cody and James McCandless

Tupelo, Miss., Sept. 11 – High-yield issuers continued to pour into the primary market on Wednesday with a number of deals that either priced or were being marketed.

Junk bond issuers have priced more than $8 billion of bonds week to date.

Tegna Inc. and Level 3 Financing Inc. brought a combined $2.1 billion of upsized deals to market.

iStar Inc., Core & Main Holdings LP, KeHE Distributors LLC, Installed Building Products, Inc. and Wynn Resorts Finance LLC/Wynn Resorts Capital Corp. are all on deck or were added to the upcoming deal calendar.

Patrick Industries, Inc.’s books close on Thursday and InfraBuild Australia Pty. Ltd. is expected Friday.

In the secondary market, Beazer Homes USA Inc.’s, WPX Energy, Inc.’s and Extended Stay America Inc.’s new notes were all busy on their first trading day.

Tegna, Level 3 price

Tegna Inc. sold an upsized $1.1 billion offering of 10-year senior notes at par to yield 5%, on the tight side of talk in the 5% to 5¼% area.

The offering was upsized from $900 million.

Level 3 Financing Inc. priced an upsized $1 billion of eight-year senior notes on top of guidance at par to yield 4 5/8% on Wednesday.

Price guidance had firmed to the 4 5/8% area from initial talk in the 4¾% area.

The deal was upsized at the launch from $500 million.

Launches and marketing

In other deal action on Wednesday, iStar Inc. launched an offering of $675 million of five-year registered senior notes. Initial price talk was in the high 4% area.

Core & Main Holdings LP was marketing $400 million of five-year PIK toggle notes.

KeHE Distributors LLC also offered $200 million of senior secured second-lien notes due 2026. Initial price talk was in the mid-to-high 8% yield area.

In addition, Installed Building Products, Inc. launched an offering during the session for $300 million of nine-year senior notes.

Meanwhile, Wynn Resorts Finance LLC and subsidiary Wynn Resorts Capital Corp. marketed $750 million of 10-year guaranteed senior notes.

The notes are being issued as part of a debt financing package that includes a new $1 billion first-lien term loan A facility and an $850 million new revolving first-lien credit facility.

Looking ahead to Thursday, Patrick Industries, Inc. intends to price $300 million of eight-year senior notes. Price guidance on the issue firmed to the 7½% area from initial price thoughts in the mid-to-high 7% area.

Books on the deal close at 11 a.m. ET on Thursday with pricing expected to follow, a source said.

At least one high-yield deal also is scheduled to print at the end of the week.

InfraBuild Australia Pty. Ltd. plans to price $475 million of five-year senior notes on Friday.

Initial price talk is in the 8¾% to 9% area.

New notes active

Tuesday issuance was the most active on Wednesday, traders said.

Atlanta-based residential construction name Beazer Homes’ new 7¼% senior notes due 2029 rose ½ point to close at 101 bid.

By the end of the day, about $66 million was on the tape.

The new $350 million notes came to market in a Rule 144A and Regulation S transaction on Tuesday.

Meanwhile, Tulsa, Okla.-based oil and gas producer WPX’s new 5¼% senior notes due 2027 edged up ¼ point to close at 100¾ bid.

$52 million of the notes traded.

The $600 million deal was upsized from an initial $500 million.

Despite the overarching trend of positivity, Extended Stay’s new 4 5/8% senior paper due 2027 shaved off ¼ point to close at 99¾ bid.

The $750 million issue saw about $30 million change hands.

Staples positive

In retail, Staples Inc.’s notes were on the rise, market sources said.

The 10¾% senior notes due 2027 jumped up 3¼ points to close at 105½ bid.

About $31 million of the notes were on the tape.

News broke on Wednesday morning that the Framingham, Mass.-based office supplies retailer had laid off about 200 employees this week.

Oil names trend up

In the energy space, distressed oil futures went higher as futures declined, traders said.

After a report of a sharp drop in U.S. crude inventories, oil futures declined.

West Texas Intermediate crude oil futures for October delivery gave back $1.65 to settle at $55.75 per barrel.

North Sea Brent crude oil futures for November delivery finished the day at $60.81 after a $1.57 loss.

Houston-based oil and gas construction name McDermott International Inc.’s paper pushed higher.

The 10 5/8% senior paper due 2024 added ¼ point to close at 72¼ bid.

London-based contract driller Valaris plc’s notes also improved.

The Rowan Cos. plc 4 7/8% senior notes due 2022 picked up 3 points to close at 83 bid. The Rowan Cos. plc 4¾% senior notes due 2024 rose ½ point to close at 65¾ bid.

Denver-based producer Whiting Petroleum Corp.’s issues shifted lower.

The 6¼% senior notes due 2023 dropped ¾ point to close at 80¾ bid. The 6 5/8% senior notes due 2026 fell ½ point to close at 75½ bid.

Indexes mixed

Three high-yield indexes saw mixed movements.

The KDP High Yield Daily index inched up 1 basis point on Wednesday to close at 71.92 with the yield rising to 5.31%.

The index shot up 9 bps on Tuesday, rose 4 bps on Monday and gained 4 bps on Friday.

The ICE BofAML US High Yield index shed 2.8 bps to finish the day with the year-to-date return now at 11.644%.

The index added 8.9 bps on Tuesday and improved by 12.8 bps on Monday.

The CDX High Yield 30 index rose 32.20 bps to 107.4377.

The index lost 32.57 bps on Tuesday, gained 32.60 bps on Monday and garnered 32.72 bps on Friday.

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