Imperial Capital LLC is delaying two junk-bond offerings in response to market turmoil over the past few weeks triggered by Greece’s potential meltdown, according to a person with knowledge of the matter.
The boutique investment bank had been marketing bonds from My Alarm Center and Globo Plc, but pushed back the sales, the person said. Imperial plans to revive the deals when the market is more welcoming to junk-rated debt offerings.
The sales would be Imperial’s first bond offerings in the public markets as lead book-runner this year, according to data compiled by Bloomberg. The firm specializes in lending to middle-market companies, typically underwriting debt transactions of up to $500 million.
Sales of junk-rated securities plunged in June, and that market all but shut down last week as Greece’s debt crisis escalated and China’s sinking stocks left investors seeking a haven in safer assets. Solera Holdings Inc. yesterday became the first below investment-grade company to price a new issue deal in July, indicating a reopening of the market for high-yield debt.
Globo, which makes software and provides services for mobile communications, is seeking to raise $180 million by selling senior secured notes at more than 8 percent, the person said. Shares of the U.K.-based company, founded in Athens by Costis Papadimitrakopoulos, plummeted 24 percent in the two weeks ended July 6. The decline prompted Globo to issue a statement last week reassuring investors that it had limited exposure to Greece and that the company actually stood to benefit from a possible Greek exit from the euro.
My Alarm Center, a security services provider, is looking to raise $265 million by selling five-year notes at a yield of about 9 percent, the person said.
Mark Martis, chief operating officer of Los Angeles-based Imperial, didn’t return telephone calls and emails seeking comment. Lora Friedrichsen, a spokeswoman for Globo at Global Results Communications, didn’t immediately comment. Representatives of My Alarm Center could not be reached for comment.
In August, Imperial led the sale of $200 million of secured bonds for energy producer Sunshine Oilsands Ltd. in the middle of the plunge in oil prices. The 10 percent notes had to be sold at a discount, offering investors a yield of 17 percent at the time of the sale, Bloomberg data show.
The debt last traded at 69 cents on the dollar, yielding 31 percent, on June 30, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.