Two weeks ago French cable company, Numericable Group (NUM.PA), raised $11 billion dollars in the high yield or “junk bond” market. Investor hunger for this offering was so strong that the company raised $2.8 billion more than it originally sought. This is the largest junk bond offering on record and it came in a series of tranches with yields varying between 4.875% for five year bonds and 6.50% for ten year bonds. These bonds, issued to pay for an acquisition are likely to be rated three levels below investment grade. Whether this offering signals the top of the market for high yield bonds is yet to be seen, but investor appetite continues to be ravenous with $160 billion of high yield bonds issued so far in 2014.
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