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Article: Junk Bonds Show Signs of Cracking.
- Article from:
- Investment Dealers' Digest
- Article date:
- October 3, 2005
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The US high-yield bond market is becoming unsettled at an inopportune time, just as a host of jumbo LBO-related deals are about to begin the marketing process. The leveraged loan market remains resilient, however, and that rescued last week's megafinancing, which backed the $5.1 billion buyout of department store chain Neiman Marcus by Texas Pacific and Warburg Pincus. Its bond deal was among several that had to be postponed or restructured in the past few weeks.
Some attribute the recent weakness in junk bonds to the extremely poor credit quality of a number of offerings that surfaced in early September. "The early deals to come to the calendar in September were ...