Leveraged finance volume soars as big-ticket M&A deals surge
Leveraged finance activity - leveraged loans and high yield bonds - is on pace to have one of its busiest months in years. The loan market, in particular, is surging, as issuers continue to take advantage of exceedingly low borrowing costs. Also contributing: Big-ticket M&A deals have returned in a big way this year. These deals, of course, can generate huge fees for arranging institutions. By itself, Heinz's buyout by Warren Buffett's Berkshire Hathaway and private-equity firm 3G will bring $12 billion of new U.S. leveraged loans to market (this is far and away the largest deal since 2007), with another $2.1 billion of bridge loans that may be taken out by high-yield bonds or second-lien loans.