The European high-yield primary market tear started up again on Monday, with three borrowers announcing new bonds as average yields crunched in to pre-pandemic levels. Leads pulled the trigger on a €1bn refinancing bond from Biogroup, along with a €600m M&A deal from jewelry retailer Thom Group and a €1.15bn two-trancher from TeamSystem - also M&A-related. Average European junk bond yields are now at 2.63% - tighter than pre-pandemic levels of 2.69%, according to iBoxx data. Central bank action has had an unprecedented amount of impact on yields, said a senior high-yield banker - despite strong volumes in the European high-yield bond market. What the market is seeing is "financial repression as a result of the unprecedented government and central bank action, which is keeping defaults low, and making sure investors feel that, no matter what, there is a put from a government standpoint," said the banker. The first two weeks of 2021 have already seen €4.5bn in euro high-yield bonds price - almost double the volume seen over the similar period in 2020. This kind of volume, which includes a substantial amount of M&A financing, is set to continue through 2021 and for the foreseeable future - unless the market hits bumps in the coming months. "M&A pipeline is an unknown so far, but the initial signs are that there is a lot more activity than any point we have ever seen in our careers, both in terms of optimism and activity," said the banker. Two M&A bonds were announced in Monday's market - from TeamSystem and Thom Group. Italian software company TeamSystem (B3/B-/B) announced a €1.15bn deal split between a seven-year non-call three fixed-rate bond and a seven-year non-call one floater. Initial price thoughts for both bonds are in the low 4s. The bond will help finance the sale of TeamSystem from one of private equity owner Hellman & Friedman's funds to another. It's the sponsor's second fund-to-fund transfer to be funded in the European high-yield market this month, following Verisure's €2.42bn-equivalent bond. The deal will value TeamSystem at an enterprise value of around €2.9bn, according to deal documents. TeamSystem will refinance its debt as part of the transaction. Bankers had said at the time of Verisure's deal that several similar fund-to-fund transfers were set to be financed in the leveraged finance market over the following weeks. JP Morgan (sole physical, B&D) is global co-ordinator and is also a joint bookrunner alongside Barclays, BNP Paribas, BofA Securities, Deutsche Bank, Goldman Sachs, Morgan Stanley, Nomura and UniCredit. Elsewhere in the market, European jewelry retailer Thom Group (B2/B) is out with €600m in senior secured notes, split between a five-year non-call two fixed-rate bond and a five-year non-call one floater. Proceeds, together with an equity contribution and cash, will be used to pay the purchase price of the acquisition and to repay a term loan B. Two of Thom's existing shareholders - Bridgepoint (59%) and Qualium (7%) are selling their stake, while Altamir will increase its stake from 25% to 59%, according to deal documents seen by IFR. The remaining stakes are owned by management, two family offices and a few individuals. JP Morgan is sole global co-ordinator and sole physical bookrunner, while BNP Paribas, ING and Societe Generale are joint bookrunners. Finally, Biogroup's €1bn dual-trancher is split between €750m in seven-year non-call three senior secured bonds (B2/B-/B+) and a €250m eight-year non-call three senior bond (Caa1/CCC/CCC+). Initial price thoughts are mid-to-high 3s and mid-5s, respectively. The bond is being marketed alongside a €1.65bn term loan B. Proceeds from the deal will refinance the French laboratory services group's existing €2.015bn first lien term loan B in full - and to repay its existing second lien and PIK notes. JP Morgan is sole physical bookrunner (B&D), and i
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