Gleacher Plans to Begin Arranging Leveraged Loans, Wessan Says
Stock Chart for Gleacher & Co Inc (GLCH)
Gleacher & Co., the New York-based investment bank that managed its first junk-bond offering last year, plans to expand into arranging leveraged loans, according to Neil Wessan, the new head of its capital markets origination group.
Gleacher also plans to increase its underwriting of high- yield, high-risk corporate bond offerings this year, Wessan, 50, said in a telephone interview. The firm helped companies sell $352.5 million of the securities in 2010, according to data compiled by Bloomberg.
The U.S. leveraged-loan market is reviving, with borrowings more than doubling to $383.5 billion last year, after plunging when credit markets froze, Bloomberg data show. Returns climbed this month to the most since July as investors betting interest rates will rise snap up floating-rate debt. Sales of junk bonds in the U.S. reached a record $286.8 billion last year.
“We have a very active secondary trading desk that is very successful on the loan side, and what I’d like to do is see if we can start generating some new issue product for them as well,” said Wessan, who joined Gleacher on Jan. 6 from advisory firm Halsey Lane Holdings LLC. “Obviously it would have to be smaller and obviously we’re not a bank and we don’t have a balance sheet at this point in time, so it will be small steps.”
Before helping to found Halsey Lane, Wessan was managing director and co-head of leveraged loan capital markets and syndication at Jefferies Group Inc., according to a Jan. 20 statement distributed by Business Wire.
Gleacher managed speculative-grade bond offerings last year for Reddy Ice Corp., a unit of the biggest U.S. maker of packaged ice, specialty-paper manufacturer Appleton Papers Inc. and FCC Holdings Inc., Bloomberg data show. Wessan said transactions that Gleacher helps arrange may typically be $100 million to $200 million.
“My hope is that we can build off of what we’ve done in the past and significantly increase the deal flow on the capital markets side,” Wessan said. “I would be disappointed if we only do three deals this year.”
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