Junk bond issuance continued at its torrid pace last week as underwriters continued to feed hungry investors.
Sixteen new public and 144a issues worth $2.78 billion had been priced by Thursday, according to KDP Investment Advisors, Montpelier, Vt., bringing this year's new issuance to $15.7 billion.
Indeed, demand was strong enough to convince numerous issuers to bump up the size of their deals. The Internet services company ICG Services, for example, increased its $200 million deal to $300 million.
"The atmosphere has generally been positive," said Tom Haag, a portfolio manager at Lutheran Brotherhood. "New issues are still getting done fairly well, and many of them are oversubscribed," he said. The number of deals on the supply side "does not seem to be taking its toll."
Though conditions are expected to remain strong, some are nervous about the impact of the Asian financial crisis on U.S. companies. Though most high-yield issuers do not do business in Asia, Mr. Haag said some worry how the Asian troubles will affect U.S. financial markets.
Chase Securities Inc. was in the market last week with a $325 million offering for LIN Acquisition Corp.
The issue includes $200 million of 10-year notes and $125 million of zero coupon bonds, which step up and pay interest at the end of five years.
This issue backs the acquisition of LIN Television Corp., Providence, R.I., by Hicks, Muse, Tate & Furst Inc.
NationsBanc Montgomery Securities Inc. was marketing a $100 million offering of unsecured senior notes for Sea Containers Ltd., Bermuda, and CS First Boston was leading a $500 million offering for Fresenius Medical Care, a German dialysis products and services company.
The issue includes $400 million of trust-preferred notes denominated in dollars and $100 million of such notes denominated in German marks.