As junk bonds wilt, new Charter deal shines

摘要

Charter communications gave the sputtering US junk-bond market a welcome boost last week by selling a US$1.7bn issue that was mostly driven by reverse enquiry from investors. The deal underscored that the buyside is still keen on higher quality paper in a tumultuous market that has of late locked out many lower-rated potential borrowers. With an eager pool of investors looking to put cash to work, the cable telecoms giant paid a pittance in new issue concession for a junk-rated credit, just 12.5bp over its existing bonds. Charter (Ba3/BB-/BB-) even managed to increase the size of the eight-year non-call three unsecured trade by US$200m, pricing it at 5.875%, the wide end of 5.75%-5.875% price talk.