Americas Leveraged Finance Weekly: M&A Creeps Back Into Refinancing-Driven Primary Market

 

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Primary Tracker
 

A sparse forward pipeline and ample liquidity continued to drive a steady wave of opportunistic repricings and refinancings in the primary market this week, even as more new M&A financings began to show up.

Activity in recent weeks has been consistently centered on issuers taking advantage of conditions for tighter pricing amid relatively muted M&A headlines, but market participants said the handful of acquisition financings this week showed promising early signs of a broader pickup in activity.

Among those deals this week was QXO Building Products’ $6 billion leveraged loan and high-yield bond package to fund its acquisition of TopBuild Corp. The Morgan Stanley-led $1.5 billion 2031 unsecured notes priced at 6.5% and the $1.5 billion 2034 unsecured notes at 6.875%, while the Wells Fargo-led $3 billion term loan B came in at SOFR+200 bps and 99.75 OID.

Smiths Detection brought a £1.04 billion-equivalent cross-border leveraged loan to fund CVC’s acquisition of the security technology division of U.K.-headquartered Smiths Group. The Barclays-led deal tested buy-side demand for a more complex transaction, given that it was a corporate carve-out and not a sponsor exit. Final pricing on the $750 million U.S. dollar-denominated tranche came in at SOFR+250 bps and 99.75 OID, tighter than the SOFR+325 bps-350 bps and 99.5 OID price talk.

Other acquisition financings include Echo Global Logistics’ $780 million UBS-led loan to fund its acquisition of ITS Logistics and repay existing debt, after the debt to fund the acquisition was originally set to launch earlier this year. Belden also launched JPMorgan-led $1.85 billion leveraged loan funding its acquisition of Ruckus Networks, with commitments due next week.

The AI buildout continues to be one of the strongest areas of demand for the primary market. Elk Grove, a subsidiary of Prime Data Centers, came to market with a $900 million high-yield bond to fund a CoreWeave-leased data center. The Santander-led deal was heavily oversubscribed and priced on the lower end of talk. The immense scale and capital needed for AI, especially in the high-yield market, was a major talking point at last week’s Goldman Sachs Leveraged Finance Conference.

Outside of M&A, McKesson priced a $2.25 billion leveraged loan to repay company debt ahead of its separation and planned IPO of the McKesson Medical-Surgical unit, with final pricing tightening. Goodyear priced $1 billion of senior notes to repay its 2027 notes, while online media distributor Overdrive upsized a leveraged loan to $750 million to amend and extend its loan to 2030.

For more information on potential deal activity, see Octus’ Deal Origination Pipeline.
 

Issuance by Use of Proceeds, Ex-Repricings

Issuance by use of proceeds for both loans and bonds but excluding repricings is shown in the charts below. For year-over-year comparisons, Octus provides data for the last 14 months.
 

 

Pricing by Rating

Average spreads and coupons for loans and bonds, respectively, by ratings band are detailed in the charts below. Because of the limited activity of CCC rated issuance, only the months with issuance are shown.

Pricing by ratings category is shown below:
 

 

 

Privately held Wilsonart’s debt prices rose this week after the company disclosed that its first-quarter 2026 adjusted EBITDA increased 9% year over year to $46 million while revenue rose 2% to $354 million, Octus reported.

The average price of Wilsonart’s $1.06 billion (at issuance) first lien term loan B due 2031 was 91.31 as of June 4, up from 88.39 on June 1, according to Solve. The average price of the company’s 11% senior unsecured notes due 2032 was 81.87 as of June 3, up from 76.95 on June 1.

Top daily loan decliners and risers can be found in Octus’ Credit Cloud. A search for the largest bond decliners is HERE.

Average high-yield bond spreads sit at 274 bps, wider than last week, according to ICE BofA data. The LSTA Leveraged Loan Index was indicated at 97.09, down slightly from last week.

Moody’s Ratings and S&P Global Ratings downgraded the following companies this week:
 

• 1440 Foods
• Verra Mobility
• American Trailer World Corp.
• Ivanti Inc.
• System1 Inc.
• Beazer Homes USA Inc.

Octus Covenants’ analyses of the documentation for new loan transactions can be found HERE.

Octus’ Private Company Analysis recent reports can be found HERE.

Octus’ Fundamentals Coverage Weekly Update highlights new-issuer coverage in Fundamentals for the syndicated credit universe alongside transcripts for syndication calls.