Savers prices; Crescent Energy strengthens; Carnival junk bonds sought; Citrix climbs

By Paul A. Harris and Abigail W. Adams

Portland, Me., Jan. 26 – The junk bond primary market saw a single dollar-denominated deal price on Thursday with two more on the forward calendar.

Savers Value Village, Inc. priced an upsized $550 million issue of senior secured notes at a discount.

Mauser Packaging Solutions Holding Co.’s offering for $2.75 billion of senior first-lien notes due Aug. 15, 2026 and Borr Drilling Ltd.’s $150 million offering of three-year senior secured first-lien notes remain on the forward calendar with Borr expected to price before the week draws to a close and Mauser on deck for the coming week.

Meanwhile, the secondary space was once again on the rise on Thursday with the cash bond market adding another ¼ point after a largely sideways week.

Thursday’s GDP print helped lift investor sentiment with the figure reflecting a slower than expected slowdown.

The print gave credence to the soft-landing scenario many market players have been hopeful for – but wary of.

“Fingers crossed,” a source said.

New paper remained in focus with Crescent Energy Co.’s 9¼% senior notes due 2028 (B1/B+/BB-) opening the day flat but gaining strength as the session progressed.

Carnival Corp.’s senior notes were sought after on Thursday with the cruise line operator’s capital structure lifted with the GDP report alleviating some recession concern.

Citrix Systems Inc./Tibco Software Inc.’s 6½% senior secured notes due 2029 (B2/B) outperformed the market with the notes trading up to their highest level since the $4 billion issue priced.

Meanwhile, outflows continued for high-yield mutual and exchange-traded funds with losses of $1.279 billion in the week through Wednesday’s close, according to the Refinitiv Lipper Fund Flows report.

Thursday’s primary

On Thursday, Savers Value Village priced an upsized $550 million issue (from $500 million) of Evergreen AcqCo 1 LP/TVI, Inc. 9¾% senior secured notes due April 26, 2027 (B2/B) at 97.986 to yield 10¼%.

The yield printed at the tight end of the 10¼% to 10½% yield talk. The issue price came in line with price talk that specified approximately two points of discount.

The deal, which was heard to be playing to a $1 billion book, traded sharply higher in the secondary market on Thursday afternoon, a trader said, spotting the new 9¾% senior secured notes at 99 7/8 bid, par 1/8 offered.

Away from the Savers deal the dollar-denominated market was mainly quiet on Thursday.

There was news on a dollar-denominated deal coming in a Scandinavian execution.

Borr Drilling talked a $150 million offering of three-year senior secured first-lien notes at 9 5/8% to 9 7/8%.

The roadshow was set to conclude on Thursday.

Meantime there is one dollar deal – a big one – parked on the active forward calendar, and scheduled to price in the week ahead.

Mauser Packaging Solutions is marketing $2.75 billion of senior first-lien notes due Aug. 15, 2026 on a roadshow set to run through Feb. 1.

Initial guidance has the notes coming to yield in the mid-to-high 8% area.

The dollar-denominated new issue market could remain relatively quiet ahead of the Jan. 31 to Feb. 1 meeting of the rate-setting Federal Open Market Committee, when investors will learn whether or not the central bank's inflation-fighting tactics are moderating in line with pundits' forecasts, sources say.

Away from the dollar-denominated market the European high-yield market remains active.

Italmatch Chemicals SpA priced a downsized €690 million amount (€700 million) of five-year senior secured notes (B3/B/B) in two tranches.

And French property management company Emeria SASU started a roadshow for a €400 million offering of five-year senior secured notes (see related stories in this issue).

Crescent gains

Crescent Energy’s 9¼% senior notes due 2028 dominated activity in the secondary space on Thursday with the notes opening the day flat but gaining strength as the session progressed.

The notes were wrapped around par early in the session.

However, they were lifted alongside the broader market with the notes trading in the par 3/8 to par 5/8 context heading into the market close, a source said.

Crescent Energy priced a $400 million issue of the 9¼% notes at par in a Wednesday drive-by.

The yield printed at the tight end of the 9¼% to 9½% yield talk.

Carnival sought after

Carnival’s senior notes were sought after on Thursday after the latest GDP print alleviated some recession concerns, a source said.

Carnival’s notes gained 3/8 to 1½ points.

Carnival’s 10 3/8% senior notes due 2028 (B2/B+) had the smallest price appreciation; the notes hit their highest level since pricing in October 2022.

The 10 3/8% notes gained 3/8 to ½ point to break above a 107-handle.

The notes were changing hands in the 107¾ to 108 context heading into the market close with the yield about 8 1/8%, a source said.

There was $24 million in reported volume.

Carnival’s 5¾% senior notes due 2027 (B3/B) rose ½ point to close the day at 82 1/8 with a yield of 11 3/8%.

There was $30 million in reported volume.

The 6% senior notes due 2029 (B3/B) gained 1 point to close the day at 78½ with the yield 10¾%.

Carnival’s 10½% senior notes due 2030 continued their strong upward momentum with the notes adding another 1¼ points to close the day on a 95-handle.

The notes were changing hands in the 95 to 95½ context with the yield 11½%.

The 10½% notes have staged a remarkable recovery over the past three months with the notes trading in the low 70s in October.

Carnival paper was in demand on Thursday with buyers in the market.

“Investors are feeling more comfortable and the yield is high,” a source said.

Citrix’s new heights

Citrix’s 6½% senior secured notes due 2029 hit new heights on Thursday with tech companies among the major benefactors of reduced recession concern.

The 6½% notes shot up 1¼ points to break out to an 88-handle.

The notes were changing hands in the 88 to 88½ context heading into the market close, their highest level since the $4 billion issue priced at 83.56 in September 2022.

The notes have largely channeled between 84 and 87 since hitting the aftermarket.

Indexes

The KDP High Yield Daily index gained 11 points to close Thursday at 53.39 with the yield 6.86%.

The index was down 5 points on Wednesday and 3 points on Tuesday after adding 4 points on Monday.

The ICE BofAML US High Yield index gained 26.8 basis points with the year-to-date return now 3.992%.

The index shaved off 4 bps on Wednesday and 0.1 bp on Tuesday after adding 3.4 bps on Monday.

The CDX High Yield 30 index rose 14 bps to close Thursday at 102.72.

The index was down 7 bps on Wednesday after gaining 10 bps on Tuesday and 44 bps on Monday.

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