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“The incredible technical conditions we’re seeing means we’re pitching more into year-end — there’s relentless marketing that we, and our competitors, are doing,” a sellsider said. “We’d be crazy not to take this window.”

As is usually the case in Europe, deals are only expected to launch until mid-December. Whilst the flow of small, opportunistic deals should keep flowing until then, some banks have spoken about rolling others into next year.

Credit: Matthew Hughes | matthew@9fin.com

That said, do the economics in such a tight market still work for European CLOs?

The sellsider said: “Arbitrage does not work at 350bps [weighted average spread]; you have to squint to see it 375bps. Most people want it at 400bps.”

“Some CLO managers are printing now and hoping to work it out later with a reset,” they added.

A second sellsider pointed to more than 40% of European loans trading above par, suggesting the repricing trend still has room to run.

This dynamic in secondary markets is increasing the allure of new deals. In fact, one buysider said that they’ve been “rotating into primary heavily”.

By 9fin’s criteria — euro-denominated loans issued in 2022 and 2023 which are trading above par and past soft call — many deals are still prime for repricing.

The 9fin screener to find these opportunities can be found here.

A buysider pointed to Phenna Group’s recent repricing transaction as an indication of sentiment: “We skipped the first time they came to market because we didn't really get comfortable with the credit story, and now they're already back repricing? Repricing a DDTL? Says everything about the market."

Step(stone) too far?

Despite the market’s tightness, Stepstone’s deal showed that investors still have some power to push back against sponsors, in this case resisting KKR’s co-op ban.

Banks launched a €1.925m-equivalent dual-tranche 2031 TLB deal across euros and dollars, with a minimum $500m dollar portion.

Another buysider said the co-op ban was an important point to push back on, as it could create a worrying precedent if unchallenged. Four buysiders said they wouldn’t have progressed with the deal if this provision had still been included in the final doc.

One leveraged finance lawyer said this was a new feature for the European market, following 2024’s high-profile Altice and Ardagh co-op agreements.

That said, they questioned how enforceable the provision against co-ops actually was: “They are very vague with broad language which prohibits any lender organisation generally. Our team thinks in practice they don’t have legs.”

You can find our full write-up here.

Switching from aggressive docs to healthy dogs, Dechra made its syndicated market debut as banks are currently marketing a £1.3bn-equivalent TLB, split between dollars and euros, for the EQT-backed company.

While investors praised the strength of the underlying business and sponsor experience, those considering the deal are still sniffing around the heavily adjusted EBITDA and cash profile in the year ahead.

“In a lot of private credit deals that have come to market you’ve seen a lot of adjustments — it definitely kind of puts a bit of caution on the name, just because you don't want to take the headline EBITDA number, which is what they're usually marketing the deal off, at face value,” said a buysider.

We covered all this and more in our deal preview.

French fridge installer Syclef was another private credit refi with its €300m TLB deal, notably keeping its maintenance covenant. Investors speaking with 9fin were warmer to the name than they’d initially expected, given the small tranche size and Syclef’s relatively bite-sized EBITDA, although others were an automatic pass on an EBITDA lagging €100m.

“I liked it at lot more than I thought I would on the first glance, given it’s only a little deal,” admitted one lender. “Maybe it’s a bit more of a private credit-type issuer, but we’ve seen much worse private credit-types come to market in recent months.”

French gambling company Betclic is also in market with a €550m TLB. A buysider noted that as France is already quite regulated, the risk of additional betting regulation was limited. However, there were questions over liquidity despite its decent size, considering sections of the market are precluded from gaming exposure.

Elsewhere, Sante Cie is coming to town. Its €735m deal refis €530m of TLB debt and pays a €175m dividend to sponsor Ardian. One buysider told us they were passing on the deal, despite strong performance in recent years given the geographical concentration (over 80% of revenues in France) of the credit.

“The management team only speak French and did the [lender] call in French,” said another investor. “I was marginal on the name, I do think there’s a lot to like. But I need to be able to communicate with them.”

Blood boiling

Grifols was in the headlines yet again after Brookfield informed Grifols that it has decided to withdraw a €6.45bn take-private offer following a dispute over the valuation of the Spanish plasma specialist as covered here.

“If it doesn’t come to market, then it’s disappointing, as paper to play for has been so thin this year. But it’s an evolving story so too early to close that door,” a buysider said.

Grifols is one of the most widely held credits among European CLOs and several CLO managers had created space for a ‘Spanish pharma’ name in forthcoming CLOs — likely alluding to new Grifols debt.

The deal would have provided substantial primary supply to the European debt capital markets with an approximately €11bn debt package, including loans and bonds issued in euros and dollars, as well as an undrawn revolver, as reported.

What’s the scoop?

Whilst no ice-cream in November sounds reasonable to most, reports that Unilever is shelving the sale of its ice cream business (Ben & Jerry’s, Magnum and Wall’s) was another cause for concern.

But those with a sweet tooth shouldn’t be starved for too long. Earlier this month 9fin reported that Froneri, the PAI Partners and Nestle ice cream joint venture, is expected to tap markets for a dividend recap in Q1 25, according to 9fin sources.

Sources also noted that the recap could be done in conjunction with a minority stake sale, which is also expected over the next few months.

For those still hungry, we also reported on this foodie private credit refi coming next year.

Away from the edible theme, we’ve also heard that packaging company Kloeckner Pentaplast is pre-marketing loans and bonds as reported here.

Check out 9fin’s latest coverage on the name (as well as others in our November Watching the Defectives).

And for those tracking distressed opportunities, our latest building materials piece is a great way to get up to speed on the topical sector.

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

Here’s a look at what loans recently priced:

Weekly leveraged loan movers

Floating the idea

Mixture between fixed and floating instruments was a theme of this week’s major bond deals.

French game manufacturer Asmodee is currently in market for a €940m dual-tranche across SSNs and FRNs. Final price talk is 5.75%-6% (versus 6.25%-6.5% IPTs) for the SSNs and E+375-400bps and par for the FRNs (versus E+400-425bps and 99.5 IPTs).

British debt purchaser Arrow Global priced €965m of SS FRNs at E+550bps and 97.5. Meanwhile, it priced €250m of SSNs at 7.625% and £250m of SSNs at 9.625%.

Italian ingredients maker IRCA priced just over €1.1bn of 2029 SS FRNs, deciding against its initially proposed split of €700m FRNs and €400m fixed notes.

Here’s a look at what bonds recently priced:

Weekly high yield movers

Forward pipeline

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