US Chart of the Week: 28 March 2019
While the market has been receptive to large loans recently, buysiders say there is not a lot of new issue deal flow in the near-term pipeline. Given that underwriting dried up in the latter part of 4Q18, and the lead time for M&A activity to come to market is typically 3-6 months, they say that it could be summer before we see a jump in new-issue loans.
Looking at the USD 16.5bn of institutional loans currently in syndication, refinancings represent 44% (USD 7.2bn) of loan volume. On the other hand, the more sought after M&A related deals account for USD 6.8bn, or 41%, of the pipeline.
The largest institutional loan in syndication now is the USD 3.2bn term loan for Staples Inc. backing a refinancing/dividend recap, while the largest M&A related deals are noticeably smaller than some of the recently issued loans, with Ellie Mae (USD 965m TLB) and Direct ChassisLink (USD 850m second-lien term loan) the largest.
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Colm (C.J.) Doherty
Global Head of Primary Market Analysis
Colm Doherty is Debtwire’s Global Head of Primary Market Analysis. He is responsible for leading the production of primary market analysis and reports focused on the leveraged loan and high yield bond markets. Prior to joining Debtwire, Colm was Director of Analysis at Thomson Reuters LPC covering leveraged loans, CLOs and high yield bonds.
Colm has a B.A. in Economics & Legal Science from National University of Ireland Galway and an MSc. in Accounting & Finance from Ulster University.