First-lien institutional yields have widened so far in January to levels not seen since July 2012. The average first-lien term loan B yield is 6.39 percent so far this month, up from 6.11 percent in December. After increasing in October due to the effects of overall market volatility, average yields have remained above the 6 percent level since then.
While investors have started the year on cautious footing, this month’s widening can also be attributed to the presence of a few smaller LBO deals that have come to market this year, all yielding more than 6 percent. CSP Technologies’ $170 million first-lien term loan is guided at LIB+525-550 with a 1 percent Libor floor and 98.5 OID; at these levels the yield is 7.06 percent. Hoover Container Solutions’ $165 million is priced at LIB+550 with a 1 percent floor and a 98 OID, yielding 7.25 percent. The average middle market yield so far in January is 6.66 percent while the average for large corporate term loans is 6.15 percent. In turn, after being almost non-existent in December, the average middle market premium is 50bp so far this month. Underliers
While investors have started the year on cautious footing, this month’s widening can also be attributed to the presence of a few smaller LBO deals that have come to market this year, all yielding more than 6 percent. CSP Technologies’ $170 million first-lien term loan is guided at LIB+525-550 with a 1 percent Libor floor and 98.5 OID; at these levels the yield is 7.06 percent. Hoover Container Solutions’ $165 million is priced at LIB+550 with a 1 percent floor and a 98 OID, yielding 7.25 percent. The average middle market yield so far in January is 6.66 percent while the average for large corporate term loans is 6.15 percent. In turn, after being almost non-existent in December, the average middle market premium is 50bp so far this month. UnderliersContact: Diana Diquez
Contact Diana Diquez
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