INSUBCONTINENT EXCLUSIVE:
Bankers who arrange debt sales for companies with less than stellar credit ratings are preparing to ramp up new offerings after the Federal
downgraded to junk -- alongside some bond ETFs and top-rated tranches of collateralised loan obligations -- provided a much-needed dose of
confidence to Wall Street and triggered a flurry of phone calls to drum up business
had been waiting for the market to improve before launching new deals, according to people familiar with the matter
They're also talking to private equity firms about options for their portfolio companies
The possibility of raising debt would offer an alternative to bank financing or cash from equity investors to help them through business
shutdowns due to the Covid-19 pandemic, said the people, who asked not to be identified because the talks are private.
Around a dozen
companies have sold junk bonds or leveraged loans in the past couple of weeks as markets started to thaw
But they've often had to pay double-digit interest rates to do so
For some issuers the Fed action could mean that they'll simply have to pay less to borrow
Secondary prices rallied across bonds and loans Thursday on confidence that the Fed was willing to do more.
