Bondholders lose their grip
Despite digging in their heels over issues such as pricing, covenants and structural subordination, bondholders seem to be losing their tug-of-war with high-yield issuers. Oliver Holtaway looks at the supply and demand imbalance that is giving issuers an edge
In recent times advocates of bondholder interests would be forgiven for wanting to tear up their manifestos and crawl into a hole. The imbalance between supply and demand has left investor discipline in tatters: the need to pick up new paper at any cost has left investors buying lower-rated paper, with less covenant protection, and at more expensive prices. But with around €7 billion of high-yield paper coming to market in March and April, and in the wake of a spirited fightback over Invensys
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