Four companies are presenting leveraged-loan deals to European investors this week, as borrowers rush to take advantage of greater stability in credit markets stemming from Greece’s move toward a bailout.
French glassmaker Verallia SA aims to raise a 1 billion-euro ($1.1 billion) term loan to fund its acquisition by private-equity firm Apollo Global Management, according to a person familiar with the matter, who asked not to be identified as they aren’t authorized to speak publicly. Altice SA, Linxens France SA and Motor Fuel Group Ltd. are seeking smaller sums, according to people familiar with the plans.
The upsurge in companies pursuing leveraged loans followed Greek Prime Minister Alexis Tsipras’s capitulation to creditors’ demands in bailout talks, which eased concern the 19-nation currency could unravel. The market had almost halted, with only Vistra Group Ltd. having previously begun an offer this month.
“Market participants were desperate for some stability to deal with their pipeline of deals,” said Tanneguy de Carne, Societe Generale SA’s London-based global head of high-yield capital markets. “If issuers are willing to pay a new-issue premium or re-pricing level, in my view, they will find a welcoming investor base.”
Greece remains a risk that could damp lending, de Carne said. The 86 billion-euro bailout proposal has to clear a number of hurdles, including approval from six euro-area national parliaments, besides Greece. On Thursday, Greek lawmakers backed reforms sought by creditors. Euro-area finance ministers also agreed in principle to extend a 7 billion-euro bridge loan to the country.
Tele Columbus AG separately said it hired banks to arrange a loan for a 711 million-euro takeover. The German cable-TV operator didn’t say how much it planned to borrow.
Verallia is also offering 860 million euros of bonds, according to a separate person. Financial-services provider Vistra is seeking $700 million of loans in dollars and euros, a person familiar with the talks said last week.