Bankers are preparing to offload over $138 billion in buyout debt into credit markets in the coming months. This volume represents the highest in the US since 2007, just before the financial crisis, and the most in Europe since 2021. Some deals are being launched early, with the majority expected before the US elections in November.
Simultaneously, companies are actively engaging in the US leveraged loan market to reprice existing debt, aiming to reduce borrowing costs. This activity follows a late-summer lull, with at least six companies initiating loan repricings on Tuesday. Notable examples include Global Medical Response Inc. seeking to reprice $2.9 billion and Heartland Dental LLC with a $2.5 billion offering.
In related economic news, US consumer borrowing saw a larger-than-expected increase in July. Total credit outstanding rose by $18.1 billion, exceeding economists' median estimate of an $11.3 billion advance. This surge was primarily driven by the biggest increase in non-revolving credit in three years.
