EMEA Leveraged Finance Weekly: Circet, Cheplapharm and Everllence Lead Loan-Heavy Week of Primary Issuance; Multiversity Bonds Plunge After Reports of Fresh Investigation

The loan market took the lead on new issuance this week, with a jumbo new-money issuance launched by Everllence alongside large deals from Circet and Cheplapharm. By contrast, it was a quieter week in the high-yield market, with Banijay Gaming and Live Nation Entertainment launching fresh paper and Airswift landing a dollar-denominated Nordic bond.

There was also some significant volatility in the secondary market, with fresh developments in the investigation into Multiversity tanking its bonds.

Geopolitical developments were likely responsible for the quieter week of issuance, according to sources, with ongoing tension over the Strait of Hormuz and the escalating conflict in Yemen pushing oil prices back up again, and elevated long-dated government bond yields across Europe and the United States raising the cost of borrowing to fresh multi-decade highs.

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Investors Like Banijay Gaming at Initial Price Whispers of 6.5%-6.75%

In the high-yield market, the main European deal this week came from Banijay Gaming, which launched a €400 million senior secured note, or SSN, due 2032 earlier this week.

Investors liked initial price whispers of between 6.5% and 6.75%, with one buy-sider praising what they perceived to be a “pretty chunky premium” of 75-100 bps to the existing notes. However, some investors revised their price expectations higher on concerns over the underperformance of French assets after the OAT-Bund spreads widened on Oct. 2.

Investors also questioned Banijay’s recent acquisition of French casino operator JOA, which they said was a puzzling divergence for an otherwise digital business. The company has said the acquisition is another step in its strategy to build a diversified European gaming leader as it adds digital expertise to JOA’s wide network of land-based entertainment destinations. One investor said the move didn’t feel like a seamless fit for the existing platform, while a second investor said they were confused about why Banijay was doing another transaction so soon after buying a majority stake in German betting and online gaming company Tipico.

The deal was expected to close today, Oct. 9. No confirmation had been received at the time of writing. Octus’ coverage of Banijay is HERE.

Live Nation Entertainment

U.S.-based entertainment company Live Nation Entertainment tapped the high-yield market this week, launching a roughly $1.4 billion-equivalent dual currency senior unsecured note, or SUN, to refinance its 6.5% senior secured note due 2027 and add a bit extra for general corporate purposes.

One investor said the business was well-liked, with low leverage and an equity cushion. But there was also notable potential for future litigation, they said, adding that the pricing did not adequately address this risk. Octus has extensively covered Live Nation’s ongoing antitrust case. Most recently, the Federal court denied the motion to dismiss the Federal Trade Commission and seven-state suit on Sept. 28. Live Nation currently has a $450 million litigation accrual related to the ongoing litigation. Read our primary analysis HERE

The SUNs were launched with two tranches sized $840 million and €500 million. The deal priced at par with a coupon of 7.125% for the downsized $730 million tranche and 6.125% for the upsized €600 tranche, significantly tight of initial price talk, or IPT, of high 7s for the dollar tranche and high 6s for the euro tranche. Octus’ coverage of Live Nation HERE.

Airswift Upsizes SSNs From $300M to $325M

Energy, infrastructure and process industries recruitment agency Airswift Global came to the Nordic primary market this week, launching a $300 million SSNs to refinance existing bonds, fund M&A in an amount of $85 million and for general corporate purposes. The deal was subsequently upsized to $325 million. The deal launched with IPT of 9.75%-10%, before tightening to price at par with a 9.5% coupon.

One investor who liked the business said it was effectively an investment in oil and gas capital expenditure, or capex, noting that about 80% of its revenues came from placing staff in the sector. He expected oil and gas capex to rise in the near term, buoyed by pent-up demand for investment due to the situations in Venezuela, Argentina and offshore Africa.

He said he preferred Airswift to competitor NES Fircroft, although NES Fircroft was a larger company with only about 50%-60% exposure to the highly cyclical oil and gas sector. Positives for Airswift included its lower starting leverage and tighter documentation, preventing material leakage after the fact, as well as its higher margins. Octus’ coverage of Airswift is HERE.

Multiversity’s Bonds Plunge After Reports of Fresh Investigation

Italian higher education firm Multiversity’s 2031 bonds dropped to the 83/87 earlier this week after several Italian media outlets reported that the Naples prosecutor has initiated a new investigation into the Italian online university group backed by CVC, sources said. The 2031 bonds were indicated as high as 93.96 prior to the news.

According to the reports, Naples prosecutors have opened two new strands of investigation into the UniPegaso-Multiversity group, noting that the group’s president, Fabio Domenico Vaccarono, was subject to a search by the Italian Financial Police, or Guardia di Finanza on Oct. 6.

The first strand concerns alleged pressure on University Minister Anna Maria Bernini to extend the exceptional remote-exam rules. Bernini is not being investigated.

The second strand is investigating whether group executives, including representatives of its sponsor, CVC, consultancy Comin & Partners and Multiversity’s COO, Andrea Buonomo, formed a criminal association to obtain favorable press coverage through advertising spend, especially around the June 2026 disclosure of the main Pegaso investigation.

The main case, which emerged in June, centers around a criminal investigation brought by Naples Public Prosecutor’s Office and Italy’s federal Guardia di Finanza against as many as 40 people over allegations that include more than 4,200 “irregular” enrolments at Pegaso Università Telematica, one of three so-called digital universities owned by Multiversity.

The bonds continued their decline in the days since, but appear to have recovered somewhat after hitting lows in the high-70s. Octus’ coverage of Multiversity is HERE.

Investors Broadly Positive on Cheplapharm 7Y €1B TLB

Investors weighing Cheplapharm’s seven-year term loan B, or TLB, were broadly supportive of the deal, noting that the recently announced asset-for-equity deal with Sanofi improved the German pharmaceutical company’s finances. However, some expressed concerns about its non-debt commitments and its business model of buying new off-patent medicines to replace declining revenue on its older ones.

Several investors noted that the deal with French pharmaceutical behemoth Sanofi is transformative for the business, reducing its leverage on terms that are positive for existing bondholders. The new TLB is being marketed on net leverage of 3.9x on adjusted EBITDA (pro forma for Latour and new financing transaction) of €1.131 billion.

While the transaction was seen as a net positive, there were some concerns raised about the execution risk involved in the deal, under which Cheplapharm is set to acquire 20 mature medicines and three global manufacturing sites from Sanofi in exchange for a 26.4% equity stake in the business. One investor said the deal involved a lot of risk-sharing between the parties, but said it compared positively to the deal Cheplapharm struck with U.S. pharmaceutical company Eli Lilly to purchase the drug Zyprexa, under which the American giant took a big chunk of the deal payment upfront.

The TLB announcement mentioned up to €390 million in additional “other senior secured debt” to help fund the payment of the cash consideration for its acquisition of the Project Latour portfolio. Investors expect Cheplapharm will rely on upsizing its TLB to pay for this, rather than by issuing a broadly syndicated high-yield bond.

The TLB is being marketed with a margin of Euribor+400 bps – in line with the €1.4 billion TLB due 2029 it is replacing – and an OID of 99.50-99.75. Investors were constructive at this price point, with one calling it “hard to reject” at E+400 bps, given current market conditions.

The deal was downsized from minimum €1.28 billion to minimum €1 billion today, Oct. 9, and delayed slightly to 3 p.m. BST from 10 a.m. BST. The OID was talked at 99.5 ahead of pricing, at the wide end of the previous talk. The margin remained unchanged at E+400 bps. Octus’ coverage of Cheplapharm is HERE

Investors Question Timing of Circet’s New €2.1B, $500M 7Y TLB

French telecom infrastructure services firm Circet’s new dual-tranche term loan B has drawn questions from investors, centered on why the group has chosen to return to the leveraged loan market so soon after a June 2026 amend-and-extend transaction. Among their key concerns are the company’s future profitability as it transitions from fiber build-out to maintenance and its slow growth into energy infrastructure services, but they praised the company’s cash generation.

Circet is coming to the market with a dual tranche cross-border seven-year TLB split between a euro tranche of up to €2.1 billion and a dollar tranche of at least $500 million. The company is issuing a total of €3 billion-equivalent in new debt, including at least €500 million of other senior secured debt. The proceeds will be used to repay existing debt, pre-fund M&A and pay fees and expenses.

Some prospective investors said Circet’s recent financials had been underwhelming, although others noted that its performance has been resilient, notwithstanding challenges in some segments, such as France, and that the company had benefitted from its scale and diversification.

Several investors said it was a challenging company to invest in at the moment, given the fiber buildout in its core market of France had already peaked, and the transition to maintenance would likely be a lower volume, lower-margin business. They added that Circet’s transition into energy services had been slower and later than they would have liked, putting the company in a position where it has to catch up in a competitive market.

Margin talk on the euro tranche is Euribor+325 bps-350 bps with 99.5 OID; the dollar tranche is being offered at SOFR+325 bps-350 bps with 99 OID.

Commitments for the euro tranche are due Oct. 13 at 5 p.m. BST and at 5 p.m EDT for the dollar tranche. Octus’ coverage of Circet is HERE.

Everllence Launches €4.7B-Equivalent 7Y TLB to Fund Bain Acquisition

German large engine and turbomachinery Everllence came to the market with a giant €4.7 billion-equivalent debt package, underwritten by multiple banks, to support Bain’s acquisition of the Volkswagen Group subsidiary.

The deal, which is split between a €2.35 billion seven-year TLB, and a €2.35 billion-equivalent dollar facility, is being marketed on total net leverage including leases of 5.4x based on LTM June 2026 structuring EBITDA of €852 million, according to sources.

One investor likely to do the deal said he liked the industry, adding that the company was well-positioned to take advantage of some of the “mega trends” of the moment, such as the data center buildout and the energy transition. One downside for the company was its continued reliance on marine engines, and more limited operations in the decentralized power space than some competitors.

Commitments are due Oct. 13 at 4 p.m. BST for the euro tranche, and 4 p.m. EDT for the dollar tranche. Octus’ coverage of Everllence is HERE.

Pipeline Points to Steady Flow of Issuance Ahead

The strong pipeline of new primary is expected to continue in the coming weeks, according to a bank note shared with investors. This includes engineered rubber producer ContiTech’s €2.35 billion-equivalent cross-border TLB to finance its acquisition by Lone Star Funds.

A total of €23.7 billion in European primary issuance is expected this month, the majority of it coming in the form of high-yield bonds, of which most will be new money, according to the note. The pipeline for the rest of the quarter stands at €15 billion, with more high-yield bonds than leveraged loans currently expected.

Pearl Petroleum Hits the Road(show) Ahead of Expected Refi

One company expected to bring a deal to the Nordic market in the coming weeks is Pearl Petroleum, which operates gas fields in the Kurdistan Region of Iraq. The company has embarked on a cross-continental nondeal roadshow this week and next, seeking investor feedback ahead of a likely refinancing of its existing $350 million 13% 2028 bonds.

Pareto Securities is handling the roadshow with meetings taking place in London, Zurich, New York and Boston between Oct. 7-15. DNB Markets and Pareto Securities acted as joint lead managers on the issuance of the 13% 2028 bond.

Investors expect the company will look to take advantage of the supportive market conditions for commodity producers to refinance its 2028s at a lower coupon, with one buy-side source suggesting price talk of 8% would be too aggressive, pencilling in a coupon above 9%. Octus’ coverage of Pearl Petroleum is HERE.

 

 

 

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