Eco Material prices drive-by; Husky joins calendar; HUB adds; CSC, Caliber higher; Forward Air rises

By Paul A. Harris and Abigail W. Adams

Portland, Me., Jan. 22 – Eco Material Technologies Inc. priced an upsized $125 million add-on (from $100 million) to its 7 7/8% senior secured green notes due Jan. 31, 2027 (B2/B/B+) at 99.26 – on top of talk – to yield 8.158% in a Monday drive-by.

It was the sole deal to price on the day.

Meantime KeHE Distributors, LLC talked its $750 million offering of senior secured notes due 2029 (B3/B) to yield in the 9% area, tight to initial guidance in the low-9% area.

The deal is set to price Tuesday.

And Husky Injection Molding Systems Ltd. and Titan Co Borrower, LLC plan to market a $1.3 billion offering of senior secured notes due 2029 on a roadshow set to run through Friday.

The deal is set to price during the week of Jan. 29.

Meanwhile, the secondary space saw a firm start to the week on Monday with the cash bond market adding about ¼ point to pare losses from the previous week, a source said.

New issues continued to drive volume in the secondary space with the deals to clear the primary market the previous week continuing to add to their already strong gains.

HUB International Ltd.’s recently priced tranches were putting in a strong performance with its 7 3/8% senior notes due 2032 (Caa2/B-) trading up to a 101-handle and its 7¼% senior secured notes due 2030 (B2/B) trading well above the reoffer price of the add-on.

Altice USA Inc. subsidiary CSC Holdings, LLC’s 11¾% senior guaranteed notes due 2029 (B2/B) and Caliber Collision’s 7 5/8% senior secured notes due 2032 (B3/B) also continued to add to their strong gains in active trade.

Outside of new paper, Forward Air Corp.’s 9½% senior secured notes due 2031 (Ba3/BB-/BB) were on the rise in active trade after the transportation company amended the terms of its acquisition of Omni Logistics, ending litigation and clearing the deal for closing.

HUB gains

HUB’s recently priced tranches continued to gain strength in the secondary market on Monday.

The 7 3/8% senior notes due 2032 shot up ¾ to 1 point with volume light given the size of the issue, a source said.

The notes climbed to a 101-handle and closed the day in the 101¼ to 101½ context.

There was $25 million in reported volume.

HUB’s 7¼% senior secured notes due 2030 added another ¼ point after strong gains on the break.

The notes were trading in the 103 3/8 to 103 5/8 context heading into the market close, a source said.

There was $31 million in reported volume.

The notes were not only trading above the reoffer price of the add-on but were also trading higher than their level prior to the pricing of the add-on.

HUB priced a $1.9 billion tranche of the 7 3/8% notes due 2032 and a $1.1 billion add-on to the 7¼% senior secured notes due 2030 on Friday.

The 7 3/8% notes priced at par; the reoffer price for the add-on to the 7¼% senior secured notes was 102 with a 6.713% yield to worst.

The deal played to strong demand with books for the 7 3/8% notes growing to around $3 billion, a source said.

The add-on, which priced at 102, broke to 102.5 bid, 103 offered, while the unsecured tranche broke to par 1/8 bid, par ½ offered after having priced at par, a trader said.

Up again

CSC Holdings’ 11¾% senior guaranteed notes due 2029 and Caliber Collision’s 7 5/8% senior secured notes due 2032 continued to add to the strong gains made after breaking for trade late last week.

CSC’s 11¾% senior guaranteed notes due 2029 added another ¾ point to shoot up to a 102-handle.

The notes were trading in the 102¼ to 102½ context heading into the market close, a source said.

There was $61 million in reported volume.

The notes have made strong gains since the $2.05 billion issue priced at par on Jan. 18.

Caliber Collision’s 7 5/8% senior secured notes due 2032 also jumped to a 102-handle.

The notes climbed ½ to ¾ point to close the day at 102½, a source said.

There was $16 million in reported volume.

The heavily oversubscribed offering also priced at par on Jan. 18.

Forward Air moves forward

Forward Air’s 9½% senior secured notes due 2031 were on the rise in active trade on Monday with the company set to close its acquisition of Omni Logistics after amending the terms of the merger agreement.

The 9½% notes rose 1 point to close the day on a 95-handle.

They were trading in the 95¼ to 95¾ context in heavy volume, a source said.

The yield tightened to 10 3/8%.

There was $45 million in reported volume.

The notes were on the rise after the company announced amended merger terms with Omni that ended litigation between the two companies and paved the way for Forward Air to close on the acquisition.

Under the amended terms, Forward Air will acquire Omni in a cash-and-stock transaction with an enterprise value of $2.1 billion.

The initial deal carried an enterprise value of $3.2 billion and was wrought with controversy with Forward Air shareholders suing to block the merger and Omni suing Forward Air when the company attempted to back out of the merger.

The deal is now set to close by the end of the week.

Indexes

The KDP High Yield Daily index gained 6 basis points to close Monday at 50.53 with the yield now 6.89%.

The ICE BofAML US High Yield index added 29.3 bps with the year-to-date return now negative 0.376%.

The CDX High Yield 30 index shaved off 6 bps to close Monday at 105.78.

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