Sales of Lowest-Rated Bonds Accelerated in 2010: New Issue Alert
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Companies sold almost twice as much debt with the lowest ratings this year as they took advantage of plunging yields to refinance looming maturities at lower costs.
Sales of notes ranked Caa1 or less by Moody’s Investors Service or graded an equivalent CCC+ or below by Standard & Poor’s accounted for 16 percent of all junk-rated sales this year, versus 8.5 percent in 2009, according to data compiled by Bloomberg. Reynolds Group Holdings Ltd., the packaging manufacturer controlled by New Zealand billionaire Graeme Hart, led issuance of the debt with $4 billion.