Loans and High Yield

Five real estate companies from Greater China made their way into the dollar bond market on Thursday, appealing to investors with short tenors and juicy new issue premiums.

Japan’s Sumitomo Mitsui Financial Group has formed an alliance with Jefferies and is providing the US investment bank with capital to pursue its ambitions in leveraged finance.

Limited partners in private credit take a hands-off approach when investing in direct lending funds. But they need to pay attention.

Direct lending funds are known for protecting their investments with leverage covenants, but the investors in these funds — known as limited partners (LPs) — may be overestimating how much protection they give, market sources warned this week. Silas Brown reports.

The recent volatility in Asia’s dollar bond market caught up with borrowers this week, as investors began to demand more premium for new deals. While issuers may have to pay up to raise funding in the near term, some bankers think a rally is imminent. Morgan Davis reports.

Allen & Overy has plucked a lawyer from Latham & Watkins as a partner in its leveraged finance team in London.

Greece’s Public Power Corp priced €500m of sustainability-linked high yield bonds on Wednesday to repay bank debt, after becoming the first HY borrower to use this structure in March.

Three real estate developers from Greater China raised additional funding from the dollar bond market through opportunistic trades on Tuesday, taking some comfort from the Chinese central bank’s recent move to boost renminbi liquidity.

State-owned Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) is in the market for a $790m loan, its largest offshore facility yet.

High yield bond investors have been slower to embrace sustainable finance than other areas of the capital markets but the tide could be turning. Asset manager Tikehau has launched a new impact credit fund, focusing on leveraged finance in a bid to push the market towards sustainability.

Investec has hired two new staffers to its growth and leveraged finance team, after launching an inaugural direct lending fund at the start of 2021.

Private equity firm Blackstone is raising $1.1bn to support its purchase of a stake in Indian IT company Mphasis. The deal is set to be the largest leveraged buyout loan in the country — and comes with a group of 13 bookrunners at the top. Pan Yue reports.