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BDC Common Stocks Market Recap: Week Ended September 20, 2019

Posted by Nicholas Marshi, BDC Reporter on Sep 23, 2019 10:31:30 AM

BDC COMMON STOCKS

On A Run

For the fifth week in a row, the BDC sector ended up in price on the week. The upward push appeared to have taken on a life of its own.

In prior weeks, the hike in BDC prices seemed to be tied to the upward direction of the broader markets. This week, however, BDCS – the UBS Exchange Traded Note which includes most BDC stocks and which we use as our gauge of price change – was up 0.9% while the S&P 500 was down (o.5%).

Since Friday August 16, the last time the BDC sector was down for the week till this last Friday, BDCS is up 2.6% and the S&P 500 2.3%. We don’t know what’s more intriguing: that the two indices are so close or that BDCS is (slightly) ahead of the S&P. (That’s not traditionally the case: YTD the gap is 5% in favor of the latter and over 5 years 69%! Of course, distributions are much higher for BDCs than the S&P 500).

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Topics: Loans, Analytics, BDC, market analytics, business development company, News, bdc reporter, research

LevFin Insights BDC Portfolio News 9-16-19

Posted by Thomas Dunford on Sep 20, 2019 2:26:25 PM

Increase in market activity brings wave of add-ons to BDC-held credits

New-issue activity ramped up last week in both loans and bonds as increasingly robust conditions paved the way for well-rated and/or well-regarded issuers to speed through the market quickly despite the crowded calendar. For bonds, it was the busiest week this year with $15.5 billion of issuance, while loan arrangers rolled out another $8.1 billion in a mix of M&A and opportunistic business, much the same as the previous week.

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Topics: High Yield, Analytics, BDC, market analytics, business development company, LevFin Insights, News, research

Unitranche: Integrity Marketing loan highlights better pricing for direct lenders

Posted by Kelly Thompson, Direct Lending Deals on Sep 17, 2019 9:04:55 AM

The $945M financing for Integrity Marketing that was put away quickly and quietly last month not only shows how direct lenders continue to log wins for larger mandates, but also the wider premiums they earn bypassing the syndicated market. 

Pricing on the unitranche loan that Owl Rock Capital, Crescent Capital and Antares Capital put together for the company closed at L+575, according to sources. That's 150 bps higher than the L+425 on the insurance broker’s previous first-lien debt. It's also well above current averages in the more broadly syndicated market. 

According to S&P Global LCD, the average all-in yield is 5.9% across large borrowers this month. With 3-month Libor at 2.14%, that puts the average spread at roughly L+375 for syndicated issuers.

Against other unitranche loans — the tool of choice for many direct lenders —the Integrity Marketing credit is right in the wheelhouse of where the majority of unitranches have priced in 2019, based on data provided by Advantage Data.

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Topics: Loans, Middle Market, BDC, First Lien, debt, business development company, Non-accruals, portfolio, Direct Lending, syndicated, underperformers, Direct Lending Deals

Harvest Partners hit direct lending market for $945M unitranche loan at L+575 to support Integrity Marketing deal: Owl Rock, Crescent, Antares

Posted by Kelly Thompson, Direct Lending Deals on Sep 16, 2019 3:00:00 PM

Harvest Partners went with Owl Rock Capital, Crescent Capital and Antares Capital last month for $945 million in unitranche financing in connection with the private equity firm’s minority growth investment in Integrity Marketing Group, a national life and health insurance broker.

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Topics: Middle Market, BDC, debt, business development company, Non-accruals, portfolio, Direct Lending, underperformers, Direct Lending Deals

BDC Common Stocks Market Recap: Week Ended September 13, 2019

Posted by Nicholas Marshi, BDC Reporter on Sep 16, 2019 2:00:00 PM

BDC COMMON STOCKS

Surprising

Notwithstanding the absence of any BDC sector news, prices continued to rise for a fourth week in a row.

As of September 13, 2019 the UBS Exchange Traded Note with contains most of the 46 public BDCs we track – and which has the ticker BDCS – closed at $20.08.

That was 1.75% higher than the week before.

Likewise, that other barometer of BDC price performance – the Wells Fargo BDC Index – reached 2,793.76.

BDCS is not at a record level, but the Wells Fargo measurement – which provides a “total return” – was again at a new year-to-date high for a second week in a row.

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Topics: Loans, Analytics, BDC, market analytics, business development company, News, bdc reporter, research


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