US$1.6bn prints in high-yield despite market chop

By Mariana Santibanez

NEW YORK, Jan 13 (IFR) - Three issuers priced US$1.6bn in the US high-yield bond market on Tuesday, including a multi-currency offering by Virgin Media that drew substantial investor interest.

But market participants expecting some US$10bn in issuance this week will have come away disappointed, after the jumbo acquisition financing from Altice looked to have been delayed.

High-yield investors had expected to see a trade of up to EUR5.7bn-equivalent backing the acquisition of Oi (Stuttgart: B9I1.SG - news) 's Portuguese operations after a shareholder vote at Portugal Telecom SGPS today, but that vote was put off to January 22.

"The expectation is that the bond is now pushed back," said a banker on the deal.

The three trades that priced today defied a fair bit of market chop driven by both copper and oil falling to new multi-year lows.

Leading the way was Virgin Media, which priced a GBP300m 10NC5 bond at par to yield 5.125%, a EUR460m senior note priced at par to yield 4.50%, and a US$400m dollar tranche priced at par to yield 5.75%.

All three tranches came inside of respective price talk of 5.25% area, 4.75%, and 5.875%. The dollar tranche was quoted at 100.5 in the secondary, a trader said.

Meanwhile metallurgical coke producer Suncoke Energy (NYSE: SXC - news) Partners (B1/BB-) reopened 2020 notes for US$200m, bringing the new outstanding size of the bond to US$450m.

Left-lead Barclays (LSE: BARC.L - news) reopened the bond at 102.00; price talk was at 101.5-102.00.

Healthcare company HCA Holdings (NYSE: HCA - news) priced an upsized US$1bn 10-year non-call life bond. Led by Wells Fargo Securities, the B2/B+ deal priced at par to yield 5.375%, at the midpoint of 5.25%-5.50% price talk.

That brings high-yield issuance to US$2.9bn for the week so far, around the US$3bn range bankers were expecting minus the Altice deal.

Still, bankers say the asset class is doing well apart from energy, with a manageable backlog of some US$18bn in trades waiting in the pipeline - most of them acquisition-related.

"The loan market is very active, but there will be more product coming to the high-yield market," one debt capital markets banker told IFR.

Among the deals on the way is Netherlands-based Ziggo, which set price talk today for its EUR730m-equivalent senior notes. US books closed today and European books close tomorrow, when the deal is expected to price.

Price talk for the euro portion is at 4.75% area while the USD dollar tranche is talked at 6.00% area.

The deals come as Liberty Global (NasdaqGS: LBTYA - news) 's European businesses are going through a reorganization involving the merging of UPC Netherlands with Ziggo, and UPC Ireland with Virgin Media.

Bond investors have expected Liberty Global to remove some businesses from the UPC credit pool for a while now, as the large size of the business meant some high-yield buyers could hit issuer concentration limits.

Also en route is Platform Specialty Products Corp, which today announced a new US$920m equivalent seven-year non-call three senior note via Credit Suisse (NYSE: CS - news) .

The issue will consist of a US$500m seven-year non-call three and a EUR350m seven-year non-call three tranche.

Fixed-income investor meetings will be launched next Tuesday, with pricing expected late next week. Proceeds will finance the acquisition of Arysta.

CITI UPGRADES AMD

Citi credit analysts raised Advanced Micro Devices (NasdaqCM: AMD - news) to marketweight from underweight due to a projected slower rate of PC market decline in 2015, free cash flow generation and forecasted leverage stability near 5x.

The near 9% bond yields are also very attractive, they said.

"This quarter we will listen for updates on recent management changes, cost reduction programs, new design wins, PC market share strategies, and 2015 guidance," said Citi analyst David Phipps.

After 3Q's disappointment, we dramatically lowered our forecasts and note the credit still muddled ... (but) we have increased confidence in the 2015 PC market and have raised our forecasts moderately."

He expects a few design wins in 2015 to partially offset PC market share challenges.

The company is due to report after the close on January 20.

DEALS PRICED:

HCA HOLDINGS INC

HCA Holdings Inc., expected ratings B2/B+, announced a US$750m 10-year NCL senior note offering via WFS(left)/BARC/BAML/C/CS/DB/GS (KSE: 078935.KS - news) /JPM/MS/RBC (Other OTC: RBCI - news) /STRH/UBS (NYSEArca: FBGX - news) . Co-managers are CA/FTS/MIZ/SMBC. UOP: to repay at maturity its $750,000,000 aggregate principal amount outstanding of existing 6.375% Senior Notes due 2015 and for general corporate purposes. Pending receipt of the proceeds of this offering, HCA Inc. may temporarily borrow any necessary amounts under its revolving credit facilities. BIZ: Based in Nashville, Tennessee, Hospital Corporation of America is an American for-profit operator of health care facilities, the largest in the world.

PRICE TALK: Deal upsized to US$1bn from US$750m. 5.25-5.50%.

PRICED: US$1bn. Cpn 5.375%. Due 2/1/25. Ip par. Yld 5.375%. +348bp vs. 2.25% 11/15/24 UST. MWC T+50bp. USD101 COC put. First pay 8/1/15. Settlement date 1/13/15. Cusip # 404119BR9.

VIRGIN MEDIA

Virgin Media is looking to raise a new 10NC5 senior secured and unsecured notes, in part to fund the acquisition of UPC Ireland (Other OTC: IRLD - news) . The Liberty Global-owned cable company is looking to raise GBP300m of Ba3/BB- rated senior secured notes and GBP625m-equivalent of B2/B rated euro and US dollar senior notes. Joint bookrunners are Deutsche Bank (Xetra: 514000 - news) (B&D), Barclays, BNP (Paris: FR0000131104 - news) Paribas, Credit Suisse and HSBC.

PRICE TALK: Books close Tuesday (Jan. 13th) at 14:30 UK / 9:30 EST. Price and allocate shortly thereafter.

- Virgin Media Secured Finance PLC, Ba3/BB-, GBP 10-year NC5 senior secured notes 5.25% area

- Virgin Media Finance PLC, B2/B, Euro 10-year NC5 senior notes 4.75% area

- Virgin Media Finance PLC, B2/B, USD 10-year NC5 senior notes 5.875% area

LAUNCH:

- Virgin Media Secured Finance PLC, Ba3/BB-, GBP300m 10-year NC5 senior secured notes at 5.125%.

- Virgin Media Finance PLC, B2/B, Eur460m 10-year NC5 senior notes at 4.500%.

- Virgin Media Finance PLC, B2/B, USD400m 10-year NC5 senior notes at 5.75%.

PRICED: First (Other OTC: FSTC - news) pay 7/15/15. Settlement date 1/28/15.

- Virgin Media Secured Finance PLC, Ba3/BB-, GBP300m senior secured notes. Cpn 5.125%. Due 1/15/25 NC5. Ip par. Yld 5.125%. +363bp vs. UKT 5.00% 3/7/25. Call schedule: 1/15/20 at 102.563, 1/15/21 at 101.708, 1/15/22 at 100.854, 1/15/23 at par. Special redemption 10% per annumat 103%. ISIN # XS1169843429.

- Virgin Media Finance PLC, B2/B, Eur460m senior notes. Cpn 4.50%. Due 1/15/25 NC5. Ip par. Yld 4.50%. +404bp vs. DBR 1.00% 8/15/24. Call schedule: 1/15/20 at 102.25, 1/15/21 at 101.50, 1/15/22 at 100.75, 1/15/23 at par. ISIN # XS1169927792.

- Virgin Media Finance PLC, B2/B, US$400m senior notes. Cpn 5.75%. Due 1/15/25 NC5. Ip par. Yld 5.75%. +382bp vs. 2.25% 11/15/24 UST. Call schedule: 1/15/20 at 102.875, 1/15/21 at 101.917, 1/15/22 at 100.958, 1/15/23 at par. ISIN # US92769VAG41.

SUNCOKE ENERGY PARTNERS

Suncoke Energy Partners L.P., existing ratings B1/BB-, announced a US$200m add-on to its 7.375% February 1, 2020 senior notes via BARC(left)/C/CS/GS/JPM/RBS (LSE: RBS.L - news) . 144a/RegS for life. First call at 105.531 on 2/1/16. UOP: Fund the assumption and redemption of the SunCoke Energy, Inc. 2019 Notes, to pre-fund certain environmental liabilities related to the Gateway facility, and for general corporate purposes Fungibility: For trading purposes, the new notes will carry a separate CUSIP (1 year for 144A; 40 days for Reg (Madrid: SL001.MC - news) -S). Upon expiration of Transfer Restrictions, the notes will be combined under existing notes' CUSIPs and will become fully fungible for trading purposes. Fully fungible for tax purposes. BIZ: SunCoke Energy Partners, L.P. (NYSE: SXCP) is a publicly traded master limited partnership. We are sponsored by SunCoke Energy, Inc. (NYSE: SXC), the largest independent producer of metallurgical coke in the Americas - The original US$250m was sold on April 29, 2014 at T+433bp.

PRICE TALK: US$101.5 - US$102.00

PRICED: US$200m. Cpn 7.375%. Due 2/1/20 NC1. Reoffer price USD102. YTW 6.799%. +543bp vs. 1.375% 1/31/20 UST. First pay 2/1/15. Equity clawback up to 35% at 107.375% prior to 2/1/16. MWC T+50bp. USD101 COC put. Call schedule: 2/1/16 at 105.531%, 2/1/17 at 103.688%, 2/1/18 at 101.844%, 2/1/19 at par. Settlement date 1/16/15. Cusip # 86723CAE8.

DEALS PIPELINE:

PLATFORM SPECIALTY PRODUCTS CORP

Platform Speciality Products Corporation (PSPC Escrow Corp), ratings tbd, announced a US$920m equivalent (E/$) 7-year nc3 senior note offering via CS(left)/BARC/NOMURA/UBS. Structure will consist of a US$500m 7-year nc3 and a E350m 7-year nc3. Roadshows : EUR launches Wednesday (1/14), USD roadshow launches Tuesday (1/20), pricing late next week Equity clawback up to 35% within the first 3-years. USD101 COC put. 144a/RegS for life. UOP: Finance acquisition of Arysta. BIZ: Based in Miami, Florida, a global producer of high technology specialty chemical products.

AEGIS MERGER SUB

Aegis Merger Sub, Inc (Presidio Inc), Caa1/CCC+, announced a US$400m 8-year nc3 senior unsecured note offering via BARC(left)/CS/CITI/GS/RBC. 144a/RegS for life. Co-manager Apollo and Natixis (Paris: FR0000120685 - news) . Roadshow schedule: Tuesday 1/13 - New York (global investor call), Wednesday 1/14 - San Francisco, Thursday 1/15 - Los Angeles, Friday 1/16 - Baltimore & New Jersey, Tuesday 1/20 - Boston. Pricing thereafter. Equity clawback up to 40% for 3-years, par plus coupon. UOP: Partially fund the acquisition of Presidio Holdings, Inc. by Apollo Global Management. BIZ: IT infrastructure solutions.

ZIGGO BOND FINANCE

Ziggo Bond Finance B.V., ratings tbd, announced a EUR730m-equivalent 10NC5 senior bond, split between Euro and US dollar tranches via CS(left)/BAML/DB/ING/MS. 144a/RegS w/o reg rights. Call protection: NC5; PAR+1/2, PAR+1/3, PAR+1/6, PAR. UOP: Finance the contribution of UPC Netherlands to Ziggo credit pool. The new issue will back the contribution of UPC Netherlands into the Ziggo credit pool. BIZ: Leading Dutch provider of cable, broadband internet and telphony services. Pricing is scheduled for mid-week.

PRICE TALK: Eur730m equivalent senior notes. Timing accelerated. USD books close at 4:30pm (NY), today (13Jan). Euro books close at 10:30am (UK) tomorrow at (14Jan). Pricing thereafter. - Euro 4.75% area - USD 6.00% area (Reporting by Mariana Santibanez; Additional reporting by Robert Smith and Natalie Harrison; Editing by Marc Carnegie)