LCD News Today, Europe: Nov. 10, 2021

Repricings returned to the European leveraged loan market today, with research data provider NielsenIQ launching a transaction to cut the costs of its outstanding dollar- and euro-denominated term loans agreed to in February.

So far in 2021, before NielsenIQ's launch, some 38 leveraged loan transactions totaling €29.54 billion had been repriced in Europe, according to LCD. Earlier in the year, repricings were much more rampant — March alone saw 12 such transactions totaling €7.34 billion repriced, as issuers looked to shave margins from the higher levels agreed to during the pandemic-hit previous year. The last successfully repriced deal came in September, and though the market backdrop remains strong, participants note that the tone is more balanced now than in the first quarter.

NielsenIQ's outstanding rated term loans of $945 million and €545 million were agreed to earlier in the year to back the buyout of the company by Advent International, priced at L/E+400 with a 0% floor. The repriced debt is talked at L/E+375 with a 0% floor offered at 99.875, suggesting a yield of 4.03%-4.05% on the dollar debt and 3.80%-3.83% on the euros. In the 30 days to Nov. 4, the average spread on all loan transactions in the European market was E+411 basis points, with a yield-to-maturity of 4.32%.

While the last European loan repricing completed in September, the last such request came from MásMóvil Ibercom SA and was withdrawn in October. The Spanish telco had been looking to amend its €2.2 billion term loan B due September 2027 to E+375-400 from E+425 before the transaction was postponed with the issuer citing market conditions — although some on the buy-side expect the deal to return at some point soon.

Market participants note that MásMóvil's transaction faced its own particular challenges, coming only a few weeks after the issuer took out a new-money financing package of €3.05 billion, including a €1 billion term loan, to back its acquisition of domestic rival Euskaltel. Certain bankers had argued even at that time that the market remained receptive to repricing requests more generally, although the number of suitable candidates with facilities priced at a premium was shrinking.

There are other ways for issuers to tap into the attractive issuance backdrop, and Syntegon (formerly Bosch Packaging Technology) is making its debut in the leveraged loan market with an opportunistic €1.02 billion deal to refinance payment-in-kind notes and fund a distribution to shareholders. The issuer will meet with lenders Nov. 11 to launch the new seven-year facility.

Story links

Leveraged loans
Syntegon launches €1B loan to refinance PIK, fund shareholder distribution
Apex Group wraps cross-border add-ons backing Sanne acquisition
NielsenIQ to reprice buyout loans, add €150M incremental facility

High-yield bonds
Energean sets terms on upsized $450M bond deal

CLOs
Barclays prices €405M Fidelity Grand Harbour CLO

Trends & Analysis
European levfin issuers resilient to rising rates, says Fitch Ratings report

Middle market and direct lending
Alliance Marine sale awarded to LBO France
Sommet Education sale begins, led by Rothschild
Potential GSAM Private Credit financing to support acquisition of HTL