By Dennis McCarthy – (213) 222-8260 – firstname.lastname@example.org
New high yield bonds are now being issued at interest rates that don’t really qualify as high.
Forbes magazine reports that the 30-day average high yield new issue bond yield fell to 6.11% at the end of January.
If your company has debt outstanding in an amount of $100 million or more, your company should consider issuing high yield bonds at these historically low rates.
Many companies continue to borrow at short-term floating rates because those rates are amazingly low. Most likely, short-term floating rates won’t stay this low for 5 to 10 years, however.
In contrast, today’s high yield bond rates present an opportunity to lock in low rates for a long period.
Also, short-term floating rate debt typically carries covenants that restrict a company.
Again, in contrast, high yield bonds typically have very few covenants restricting the issuer.
Please contact me to discuss raising high yield bonds or any capital market transaction.