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If investors were really honest with themselves, most would admit to having no clue what DeepSeek was prior to this week — but, of course, that hasn’t stopped it from dominating discussions and column inches.

As covered in our reaction piece here, it has largely been a story for stocks, specifically across the pond.

“The DeepSeek news has really not made a dent in our market,” said one levfin market maker in London. “The market widened modestly yesterday but retraced everything in European hours. This is more of a tech equity story versus credit.”

A sellsider said headlines didn’t affect planned syndications for the week even for tech-adjacent names in Europe.

And when you consider how strong the technicals are for credit markets, can you be surprised?

CLO formation continues to drive the strong bid for paper; the sellsider expects €50bn in volumes this year versus last year’s already-bumper €48bn. Euro AAA CLO liabilities on some new issues hover just above 120bps on the tight end, according to 9fin data.

“As usual, we’re seeing way too many repricings and not enough new money,” a buysider said.

Please, sir, I want some more

Representing some new money, albeit via a fund-to-fund transfer versus M&A, United Petfood is in market for a €1.225bn TLB. Price talk is E+350-325bps at 99.75.

Buysiders praised the company’s resilient business model but ultimately bemoaned tight pricing, one saying: “In a recession, people will continue spending on two things: their kids and cats.” Look out for 9fin’s full deal preview early next week.

The move to a different Waterland Private Equity fund instead of another buyer highlights continuing difficulties around sponsor exits.

“The valuation between buyers and sellers is coming down but rates not coming down as quickly as people expected isn’t helping,” a second sellsider said.

Private credit refis like VDK Groep continue to aid supply in the meantime. The Dutch installation and maintenance firm priced a €510m 2032 TLB at E+350bps and 99.75 OID, with a €125m delayed drawn term loan (upsized from €100m).

The deal refinanced a unitranche provided by Tikehau in 2022 and a senior secured loan lent by Capital Four the following year.

“VDK is highly rated and the pricing is very tight considering it’s coming from private credit,” a second buysider said ahead of pricing. “The market will buy it easily.”

You can find 9fin’s full analysis of the deal here.

Ecotone launched a €405m A&E deal to general syndication this week. The health food firm has languished under its S&P CCC+ rating since April 2023, struggling to swallow inflationary pressures and losing volumes during a cost-of-living crunch.

But S&P pushed Ecotone back into B- on Monday on learning about the three-year A&E to 2029, clearing the way for lenders to drink this deal down.

“That is the critical part of this transaction,” said a third buysider. “If they didn’t get out of triple-C then the whole deal was a non-starter.” Here’s the deal preview.

AVIV Group and Questel round off some of the week’s most interesting loan deals.

On AVIV’s €1.05bn 2032 TLB, lenders were pleased to see some new money supply, though lamented some loose docs, as we wrote in our deal preview. Two investors said allocations on the deal were poor this week, at sub-30% for each. It priced at E+400bps and 99.5.

According to a second sellsider, not involved in the Aviv deal, the wider price was not linked to any concerns related to the credit, but more to a premium that BSL first-timers have when debuting in the market.

Questel just priced its €425m 2032 TLB at E+400bps and 99.75 (from E+400-425bps and 99.5), despite concerns from some investors on the week’s AI headlines.

“It seems fine, just a little small. I'm broadly comfortable with this leverage level, though it looks less favourable due to the size. Recurring revenue, non-discretionary services, and a hot market — so it should do well,” said a fifth buysider in our deal preview.

Falling over themselves for floaters

Further highlighting the strength of the market, Engineering Group (a name that has recently featured on 9fin’s restructuring watchlist and attracted short-seller attention) priced dual-tranche notes (fixed and floating) to refinance its 2026 SSNs.

We delved deeper into the deal and its notable pricing in this write-up.

"The market is crazy buoyant — Wagamama tightened and now we’re seeing this Engineering Group pricing,” an advisor said. “Seems like a lot of high yield credits will get away.”

A sixth buysider said they “passed immediately” on Engineering Group due to credit concerns.

A source familiar with the deal argued that more people were confident about EBITDA getting cleaner (as adjustments decreased), suggesting the credit was at an inflection point, providing upside opportunity.

What really stood out were the pricing dynamics of the deal. Engineering Group priced its FRN tranche about 26bps tighter than the fixed tranche — reversing a trend that had defined 2024.

Last year, senior secured FRNs were wider for all 19 companies that concurrently issued euro SSNs, with an average yield differential of 122bps. Earlier this month, Kilotou priced its FRNs (E+350bps at 100.25), albeit a tap, about 120bps wider than the fixed tranche (5% coupon).

CLOs could be another factor behind the tighter pricing for Engineering Group; the source familiar with the deal confirmed the FRNs were a CLO-driven book.

“People love the call protection available in FRNs too,” they added. “In the loan market, something like this gets repriced in six months. CLOs held the fixed paper already so it was a known name.”

Weekly leveraged loan movers

Here’s a look at what loans are currently in market:

Here’s a look at what loans recently priced:

Weekly high yield movers

Here’s a look at what bonds recently priced:

Forward pipeline

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