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George Ma
May 18 16:08

Take the money before it's too late, bond sellers say

There is one important lesson to be learned from this financial crisis: you have to take profits before they turn into pumpkins.
Todd Rodman, Managing Director of JPMorgan & Chase in London, who works in the high-yield assets and debt markets, believes that with such an uncertain future, investors in the high-yield European bond market need to make a profit.
Some people agree with this opinion. Interest in refinancing the debt of European diagnostic company Synlab Bondco Plc turned out to be so high that this week the company decided to double its bond issuing.
Meanwhile, demand for Eurobonds of the American IT company BMC Software Inc. also exceeded the amount it planned to attract, sources familiar with the circumstances of the case report. Even the operator of the theme park Merlin Entertainments, which closed most of its 130 attractions, increased the supply and set the price at a lower level than the original estimates.
Countries around the world are slowly opening up their economies with support from central banks, and the European high-yield bond market, which fell into an anabiosis in February, is reviving. Companies are afraid to wait for better conditions because inevitably weak second quarter results or a new spike in disease could bring down demand again.
While a few weeks ago the organizers advised to enter the market only for those companies that desperately needed financing, now there is a strong inflow of investments in this segment. Under these circumstances, companies are willing to raise funds to increase liquidity, refinance existing debt and even takeovers, as in the case of BMC.