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The European leveraged loan market has suffered from diminishing deal flow as financings opt to go to the US or high-yield bond markets, calling into question the significance and relevance of European syndicate desks and their ability to withstand the loss of business.
Sponsors of European companies are opting to tap the US leveraged loan market to raise financing, lured by the greater liquidity, covenant-lite structures and higher leverage that European counterparts cannot offer.
Europe’s secondary loan market rose last week to a post-crisis high as other credit and equity markets soared and technical conditions continued to be positive. Europe’s top 40 leveraged loans rose 11bp to 99.74 on Friday from 99.63 a week previously, reaching a post-crisis peak. The last time secondary prices were this high was in July 2007, shortly before the collapse of Lehman Brothers.
- Acromas refi nears closure
- First-quarter volume climbs 20%
- Bankers left red-faced by shock buyouts
- CLOs boost for European loans
- Prices rise as activity picks up slightly
- Dividend recaps back on European agenda
- Prices flat as market quieter over Easter break