Things really do not get any better this. M&A has returned in full force, the global leveraged finance boom has continued and deals in the exciting new structured finance sector abound. Even the tightly priced refinancings that have dominated the market in recent years have become a distant memory, at least outside of the US. Profitable deals have finally returned as a market mainstay. In short, 2006 is the year that loan bankers have been waiting for. The return of corporate M&A has bee

Volumes in the North American leveraged loan market rose to US$508.8bn for the year to September 19, up from US$386.2bn and US$329.4bn for the same periods in 2005 and 2004 respectively, according to data from Thomson Financial. Even as volumes expanded, hungry investors were there at every turn to lend to companies of varying credit quality. And demand dictated that they often faced heavy scalebacks on their original commitments. “Market conditions for the first several months of the year were

Investment-grade corporations have completed US$706.1bn in loan volume for year to September 19, according to data from Thomson Financial. That’s a roughly 11% larger market than last year when borrowers recorded US$636.2bn in volume for the same period, and 22% larger than the loan market in 2004 when volumes reached US$578bn. A variety of factors has driven this escalation in volumes this year. Time Warner led the year with its outsized US$21bn refinancing, while issuers such as Tribune tapped

Having recovered from the downturn that forced them to clean up balance sheets and sell non-core assets, companies have returned in force to the acquisition trail, ending the recent spell in which the private equity industry was the dominant force on the M&A buy-side. At the same time, recovering equity values have led shareholders to regard the prospect of a take-private with deep suspicion, reasoning that if there is sufficient upside in their investment to attract take-private bids, they migh

M&A is back. Bankers are cheering the return of premium paying acquisition-related transactions and are salivating at the mass of ancillary business attached to these takeover deals. “Few deals, almost none, were the traditional five to seven-year undrawn backstop deals priced at 12.5bp to 17.5bp, which was a feature of 2004 and continued into 2005,” said David Bassett, managing director and global head of loan markets at RBS. “It is hard to beat that pricing this year, so there have been fewer

In 2006, bankers threw away the rule book on Latin American loans. All previous price, size and credit assumptions flew out the window with landmark transactions culminating in CVRD's astonishing acquisition financing in August. As Brazilian pricing converged towards high-grade Latin American levels, Mexican borrowers like Bancomext, Carso and Pemex proved that new lows were there to be struck. And Tenaris showed how an Argentina-based entity could swiftly raise US$2.7bn to buy a US-based firm.

The Australian syndicated loan market is buzzing in anticipation over the potential business linked to the frenetic acquisitions activity that has dominated headlines there in recent months. The deal which has grabbed the imagination of bankers most has been the anticipated A$17bn-plus takeover of iconic retailer Coles Myer, which could require a debt facility in excess of A$10bn. The potentially huge funding requirements from this one deal alone is an indication of how leveraged buyouts in Aust

These increased opportunities for leveraged finance are not surprising given that Asian companies, particularly Chinese and Indian corporates, are on an overseas acquisition spree. Additionally, global private equity houses and venture capital firms have set up shop in Asia as part of their relentless hunt for good returns. This has led to an increase in LBOs, which has prompted investment banks to follow them into the region to help finance these deals. While in the past Japan, Australia and So

The Middle East remains a buoyant market, with oil money still flooding the region with liquidity. The staple flow of project finance deals has continued this year but it has been the boom in corporate issuance that really has the market buzzing. In 12 months to August 2006, there were 74 loans issued worth US$67bn, compared with 86 deals worth US$52bn the year earlier, according to data from Thomson Financial. “The growth of investment banking in the region is a sign of what is happening in the

Ten years ago, in response to the growth of secondary loan trading in Europe, the LMA was founded in London with seven members. In 1996, the European loan market was on the cusp of a merger fuelled boom that would see volumes rocket. But at that point deals were small compared to the jumbos that are common today, while the secondary market was little more than a side show. "The association was initially focused on the development of a legitimate secondary loan market in Europe; 'liquidity' was,

For a country that has sometimes awkwardly sat between Europe and Asia, the Russian loan market now looks firmly European. After the calamitous default of 1998 the market has moved from a backwater that a handful of lenders dominated and where only secured credit was on offer to a deep and liquid market where relationships are vital to the success of large, cheap credits. "Whereas sometime ago Russia was seen as largely a yield play, relationships are now key," said Charles Griffiths, head of Eu

Data from Thomson Financial shows that German companies have signed 107 loans worth almost US$189bn so far this year, which although smaller in terms of number of deals, has already overtaken last year's US$184bn volume total. At this level, Germany is now the largest loan market in Europe in volume terms, overtaking the UK, which has traditionally held this title, and France, which has occasionally challenged for it. The new situation corrects something of an unusual situation. Despite its stat