Europe’s Frothy Junk Bond Deals Ring Alarm Bells for Investors
- Casino, IMA, Jaguar among companies to upsize high-yield deals
- Investors concerned new U.S. deal term will spread to Europe
This article is for subscribers only.
Europe’s junk bond market is showing signs of froth as companies take advantage of demand to increase borrowing and weaken investor protections.
Companies have sold 5.5 billion euros ($6.7 billion) of high-yield notes so far this month, 68% more than all of last December, according to data compiled by Bloomberg. Central bank purchases have contributed to demand, driving average borrowing costs to the lowest since February, Bloomberg Barclays index data show.