Integra Telecom Holdings Inc., a provider of telephone and internet services to small businesses, is marketing $500 million of six-year notes as debt due in less than three years underperforms longer-maturity issues.
Integra plans to use proceeds along with bank loans to repay existing debt, it said in a statement. The Portland, Oregon-based company has $630 million of bank loans coming due by August 2013, according to data compiled by Bloomberg.
High-yield, high-risk bonds maturing in five to seven years returned 7 percent in the first quarter, compared with 5.6 percent for securities due in one to three years, wrote James Kochan, chief fixed-income strategist at Wells Fargo Fund Management, in an April 6 note to clients. Companies are taking advantage of the returns to issue bonds and refinance debt, Kochan said.
“For many borderline companies, this rally has saved them,” Kochan said in a telephone interview from Menomonee Falls, Wisconsin. “Companies have taken advantage of the market to repay short-term debt and repair their balance sheets.”
The extra yield investors demand to own bonds rated below Baa3 by Moody’s Investors Service and BBB- by Standard & Poor’s widened 7 basis points to 572 basis points after ending last year at 639 basis points, according to the Bank of America Merrill Lynch U.S. High Yield Master II Index. A basis point is 0.01 percentage point.
Absolute yields on junk-rated debt fell to 8.55 percent, near the lowest in more than two years, as Treasury prices rose after an auction of 10-year government bonds drew the strongest demand since 1994.
Moody’s assigned Integra Telecom’s notes a rating of B2, five steps below investment grade, and said its outlook was negative, citing “higher debt servicing costs and ramping up of growth initiatives,” analysts led by Gerald Granovsky wrote in a report.
Freescale Semiconductor Inc., the computer chipmaker bought in a 2006 leveraged buyout led by Blackstone Group LP, sold $1.38 billion of eight-year notes to lead $1.88 billion of high-yield bond sales yesterday, according to data compiled by Bloomberg.
Companies have sold $4.48 billion of high-yield debt this week, compared with $5.41 billion in the comparable period last week, Bloomberg data show.
Spreads on investment-grade U.S. corporate debt expanded 1 basis point to 158 basis points, according to the Bank of America Merrill Lynch U.S Corporate Master Index. Absolute yields fell 9 basis points to 4.57 percent, the index data show.
Lorillard Tobacco Co., the cigarette maker based in Greensboro, North Carolina, sold $1 billion of debt due in 10 and 30 years and Credit Agricole, France’s largest bank by assets, sold $1.25 billion of five-year notes, among $5.75 billion of investment-grade issues.
Investment-grade sales totaled $7.27 billion this week through yesterday, compared with $7.37 billion over the same period a week ago, Bloomberg data show.
Following is a description of at least $5.95 billion of pending sales of dollar-denominated bonds in the U.S.
INTERNATIONAL FINANCE CORP., the private-sector arm of the World Bank, plans a benchmark offering of five-year notes, according to a person familiar with the sale. Deutsche Bank AG, HSBC Holdings Plc and UBS AG are underwriting the issuance, said
ITAU UNIBANCO HOLDING SA, Brazil’s biggest non-governmental lender, plans to sell 10-year subordinated dollar bonds, said a person familiar with the offering. Itau may issue the 10-year bonds to yield from 237.5 basis points to 250 basis points more than U.S. Treasuries, said the person, who declined to be identified because terms aren’t set. Goldman Sachs Group Inc.,
FORETHOUGHT FINANCIAL GROUP INC. plans to sell $150 million of 10-year bonds, according to a person familiar with the transaction, who declined to be identified because terms aren’t
TRANSNET LTD. plans to sell $2 billion of international debt to help fund infrastructure spending, the company said in an e-mailed statement. A global medium-term note program set up on the London Stock Exchange will allow the South African state-
RENAISSANCE CAPITAL, the commercial banking arm of Renaissance Group, is selling $225 million of three-year bonds
The PROVINCE OF CORDOBA, Argentina, plans to sell as much as $350 million of bonds in international markets once the
SENSIENT TECHNOLOGIES CORP. said it entered into an agreement with a group of four financial institutions for the issuance of $110 million in fixed-rate, senior notes, according to a Nov. 19 statement distributed by Business Wire. The company will issue seven-year debt in May with a fixed coupon rate of
INTEGRA TELECOM HOLDINGS INC. plans to sell $500 million of senior secured notes, according to a person familiar with the offering. Proceeds from the issuance, which may be priced as
GLOBAL GEOPHYSICAL SERVICES INC. may sell $200 million of notes due in 2017, according to a person familiar with the transaction. Proceeds from the sale will be used to repay debt
MERGE HEALTHCARE INC. plans to sell $200 million of senior secured notes due in 2015, according to a company statement.
RADIATION THERAPY SERVICES INC. plans to sell $310 million of senior subordinated notes due in 2017, according to a person
ROSETTA RESOURCES INC., an oil and natural gas company, plans to sell $200 million of senior unsecured notes due in 2018, according to a company statement. Proceeds will be used to
MANTECH INTERNATIONAL CORP., a military contractor that provides technology to the U.S. government, plans to sell $200 million of 8-year notes, according to a company statement distributed by Business Wire. Proceeds will be used for general corporate purposes and to support future growth through
NEXSTAR BROADCASTING GROUP INC., which owns or provides services to 62 U.S. television stations, plans to sell $325 million of senior secured second-lien notes, the company said in a statement. Proceeds will be used to repay debt and for general
PATHEON INC., the Mississauga, Ontario-based pharmaceutical outsourcing company, plans to sell $280 million of senior secured notes due in 2017, according to a company statement.
AMERICAN RESIDENTIAL SERVICES LLC plans to sell $150 million of senior secured notes due in 2015, according to a
WESTERN EXPRESS INC. plans to sell $275 million of 8-year senior secured notes, according to a person familiar with the transaction. Proceeds will be used to repay outstanding indebtedness and for general corporate purposes, said the
LEARNING CARE GROUP NO. 2 INC. is planning to sell $265 million of payment-in-kind notes that can pay interest in the form of added debt, according to a person familiar with the transaction. The company plans to issue five-year senior secured notes, of which 10.5 percent can be paid in cash and 2.5 percent
COMMUNITY EDUCATION CENTERS INC. plans to sell $210 million of six-year, senior secured notes that may yield 12.75 percent to 13 percent, according to a person familiar with the offering. The notes, which can’t be called for the first 3.5 years, will be sold in a private placement, said the person familiar with the transaction. The company initially planned to sell the debt in a so-called 144A offering, will borrow the money through a private offering. Proceeds from the sale may be used to repay
PT CILIANDRA PERKASA, an Indonesian palm-oil company, may
AO ASTANA FINANCE will offer senior creditors $350 million of new bonds, as well as recovery notes and 58.9 percent of voting shares, the lender said in a statement published through the Kazakhstan Stock Exchange. Holders of Astana Finance’s domestic notes will be offered 20-year tenge-denominated bonds
The DOMINICAN REPUBLIC may sell as much as $600 million of bonds, said Roberto Cabanas, head of general financing at the Public Credit Office. The government hired Barclays Plc and Citigroup Inc. to arrange the country’s first international
Offerings in Pipeline
UNION BANK OF INDIA LTD. plans to sell bonds denominated in U.S. dollars, according to a person familiar with the matter.
POWER SECTOR ASSETS AND LIABILITIES MANAGEMENT CORP. of the Philippines may sell $1 billion of dollar-denominated bonds and more local-currency notes to refinance maturing debt this year,
BRISBANE AIRPORT CORP., owner of Australia’s third-busiest airport, may sell bonds in the U.S. later this year as it pursues new markets to help refinance debt and pay for a new runway. The company is considering a 10- or 15-year U.S. private placement and a five- to seven-year Australian dollar bond sale
VIETNAM NATIONAL COAL-MINERAL INDUSTRIES GROUP, the state-owned coal producer known as Vinacomin, plans to sell as much as $500 million of bonds overseas this year to fund mining and
The PHILIPPINES plans to sell $500 million of dollar- denominated bonds to overseas nationals and may sell up to $1 billion, Deputy National Treasurer Eduardo Mendiola said. The bond sale gives the government “flexibility” in domestic borrowing, Mendiola said in an interview. It may reduce second-
UNO RESTAURANT HOLDINGS CORP., the operator and franchisor of 170 pizzerias, filed a Chapter 11 reorganization plan that calls for a $27 million offering of notes. The Boston-based company’s rights offering of second-lien notes would enable it to repay an outstanding loan and exit Chapter 11, it said in court papers filed in U.S. Bankruptcy Court in Manhattan. Secured debt holders Twin Haven Capital Partners LLC and
FINLAND may sell five-year bonds denominated in dollars
POLAND may sell around $1 billion of bonds in dollars and about $500 million denominated in yen by the middle of the year, Deputy Finance Minister Dominik Radziwill told Dziennik Gazeta Prawna in an interview. Poland is unlikely to sell more bonds to international investors after the sales, which will meet the
HYUNDAI MOTOR CO., South Korea’s largest automaker, is considering a benchmark sale of five- to 5 1/2-year dollar bonds, according to two people familiar with the matter. Barclays Capital, Bank of America Merrill Lynch, Citigroup Inc., Goldman Sachs Group Inc. and Nomura Holdings Inc. are organizing
SONGA OFFSHORE SE postponed its plans to issue $200 million of debt, but may return to the market in March with a larger offer, according to a person familiar with the transaction. In January, Songa hired Citigroup Inc. to issue seven-year bonds to
HUDSON PRODUCTS HOLDINGS INC. postponed its $250 million sale of six-year notes due to market conditions, according to a person familiar with the transaction. Hudson began marketing the six-year senior secured second-lien notes on Jan. 26, according to a person familiar with the offering. It has not specified
MONGOLIA plans to sell as much as $1.2 billion of bonds overseas later this year to fund infrastructure to support its mining industry, Finance Minister Sangajav Bayartsogt said. This is Mongolia’s first benchmark offering of dollar-denominated debt. Investment banks are advising Mongolia to issue debt with maturities of between five and 10 years, Bayartsogt said in an
KOREA HYDRO & NUCLEAR POWER CO., a unit of state-run Korea Electric Power Corp., delayed a planned foreign-currency bond sale until after the first quarter, according to two people with direct knowledge of the matter. The Seoul-based company will meet this quarter’s needs with bonds or loans denominated in won
BIRCH COMMUNICATIONS INC. is offering $100 million of senior secured notes due in 2015, with proceeds going toward refinancing debt, buying outstanding warrants for its common stock and general corporate purposes, including acquisitions, the Atlanta-based company said Nov. 30 in a statement. On Feb. 1, Moody’s withdrew its B3 rating assigned to the company’s notes, citing “recent indications” that Birch “will complete its note issuance under terms that are different than those that supported the rating assignment,” analysts Gerald Grnovsky and Russell Solomon wrote in a note. Birch is rated B- by S&P, the ratings company wrote Dec. 4 in a statement. “We’re currently holding discussions with interested parties and expect to finalize our offering in the near term,” Greg Corwin, director of marketing for Birch, said in a Jan. 11 telephone interview. Corwin said the status of the deal was “unchanged” in a Feb. 17 interview.
(Updated Feb. 17.)
VIETNAM SHIPBUILDING INDUSTRY GROUP, the state-owned company known as Vinashin, won government approval to sell as much as $600 million of bonds overseas to fund construction of ships. Vinashin plans to raise between $400 million and $600 million in a dollar-denominated bond sale, “hopefully” in the first quarter “and with a government guarantee,” Chief
ANGOLA may begin the sale of international bonds by the end of June, Reuters reported, citing people it didn’t identify. The African country “is on course to get” its first credit rating from an international agency as it prepares to sell bonds abroad, Aguinaldo Jaime, director of state-run National Investment Agency, said Feb. 12. Angola previously sought to
ALROSA, Russia’s diamond monopoly, may sell as much as $1 billion in foreign-currency bonds in the second half of 2010,