Macroeconomic concerns are weighing on lending and investment in riskier asset classes
NEW YORK, May 25 (IFR) -
Many of the deals that were pulled were dividend transactions or lower-quality high-yield transactions, said one leveraged credit portfolio manager.
"These were deals that were 'sold' to the company when the markets were feeling better and they missed the train as the markets have faltered for these more aggressive transactions," said the manager.
Hudbay Minerals, meanwhile, decided to postpone its B3/B $400 million eight-year non-call four senior notes offering as market conditions proved particularly unfriendly to the mining sector, which has already been under pressure amidst a commodities sell off.
The postponements come at a time when global market volatility is forcing lenders to demand more bang for their buck. while spread widening is making the bond markets expensive for issuers.
"Given the weakness in the market and the turn in flows, it has become a buyer's market," said Gershon Distenfeld, head of US high yield for AllianceBernstein.
"Companies that don't have to issue now will likely stay on the sidelines for the time being, looking for a more opportunistic time to issue. Those companies that have to issue debt in the near-term will be forced to pay quite a bit more than they would have several weeks ago."
