Travis Perkins Sells Sterling Junk Bonds as Next Plans Debt Saleby
Travis Perkins Plc sold junk bonds in pounds, the third such sale this year.
The British building-materials distributor issued 300 million pounds ($434 million) of 4.5 percent bonds due in seven years, according to data compiled by Bloomberg. Clothing retailer Next Plc said it’s hired banks for investor meetings as it seeks to also sell sterling bonds.
Issuance of high-yield notes in pounds, which is 79 percent lower this year because of uncertainty over the U.K.’s future in the European Union, has been dominated by companies that derive their earnings from the country. Budget hotel chain Travelodge Hotels Ltd. and Yorkshire Water Services Ltd. have also sold bonds this year.
Officials at Northampton, England-based Travis Perkins didn’t immediately comment on the sale when contacted by e-mail and phone. Next, which generates about 90 percent of its revenue in the U.K., will use proceeds to help refinance 213 million pounds of debt maturing in October, said a spokesman who wouldn’t say how much the company plans to raise.
The average yield on sterling high-yield bonds was 6.83 percent on Wednesday, according to Bank of America Merrill Lynch indexes. The 2 percentage-point premium the debt commands over borrowing in euros is the most since 2009, the data show.