Marlborough Partners, the independent debt advisory firm, today published its report on the European leveraged finance market for Q1 2018.
The report, analysing data from a number of sources, shows the UK significantly increased its share of the European Leveraged Loan market in the quarter with leveraged loan volumes in the UK of €13.9bn, greater than the three previous quarters combined. This was driven by an increase in average deal size, with several large landmark deals closing in the quarter. Issuance in the wider European Leveraged Loan market continues to track the record pace set in 2017 with total volumes marginally up on the same period last year (€35.7bn vs. €35.3bn). Despite yields widening, they are still close to historically low levels and the European high-yield market remains solid, hosting €19.6bn of bond volume in the quarter, which was down on the €24.9bn generated in Q1’17 but above Q3’17 levels.
The Q1 2018 Report also reflects on the evolution of the Private Debt market over the last 7 years. Marlborough Partner, Romain Cattet said: “Private debt has been one of the few success stories to emerge from the global financial crisis as debt fund managers filled the gap left by the shying away of traditional banks from riskier lending driven inter alia by higher capital requirements due to Basel II and subsequent iterations, and the Fed/ECB guidance on leveraged transactions. As the abundance of private debt funds increases so does the range of products they offer. These funds now come in many forms and employ a wide range of strategies with different risk/return profiles; their product suite extends well beyond the plain vanilla Unitranche. As banks remain risk averse and mono-product with limited ticket sizes, they are likely to continue to lose market share to these now well-established players.”
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About Marlborough Partners
Marlborough Partners, based in London and Frankfurt, provides specialist, independent advice to private equity firms, portfolio companies and corporates, on sourcing and structuring debt and other non-equity finance. Since 2003, the Marlborough team has advised on 233 completed transactions – from the simple to the highly complex – comprising over €50bn of primary market debt issuance, waivers and amendments and loan restructurings in eleven European jurisdictions. For further information, visit www.marlboroughpartners.com