Performing Issuers should take advantage of the strong market window

Issuers should take advantage of strong technicals and robust investor demand to pursue a variety of opportunistic transactions including refinancings, repricings, and dividend deals.

• As of December 15^th, YTD dividend volume was up 170%+ from the full period the year prior, from $5.9 billion to $16.1 billion, still low compared to historical levels.

• For the week ending December 15^th, there was $11.2 billion in gross launched loan volume all for opportunistic transactions.

• Following the dovish Fed meeting in December, secondary levels surged to YTD highs, which will allow issuers to pursue further opportunistic transactions in January.

• The broad loan index is at 96, the highest level since May 2022.

• with 54% at 99 or higher, the highest levels since January 2022.

Here are a few examples of transactions Jefferies has recently led that capitalized on these more favorable conditions:

• Jefferies was Sole Arranger on Medallion Midland’s repricing of their $872 million First Lien Term Loan.

• Medallion, backed by Global Infrastructure Partners, is a crude oil gathering/intra-basin transport system in the core of the Midland Basin of the Permian, with 1,240 miles of pipeline.
• The loan was repriced to S+350 from S+CSA+375, allowing the company to lower its weighted average cost of debt.
• Due to strong investor demand the loan was upsized by $50 million in market.

• Jefferies was Left Lead Arranger on CPM Holdings’ $1.215 billion First Lien Term loan, with proceeds from the deal used to refinance existing debt and fund a distribution to shareholders.

• The First Lien Term Loan priced at S+450, 0.50% floor and 98.5 OID.
• As a result of oversubscription from investors, the First Lien Term Loan was upsized by $85 million to $1.215 billion, and pricing was tightened from S+475 to S+450 and OID was tightened from 98.0 to 98.5.
• The Company was able to address its upcoming 2025 maturity while opportunistically funding a dividend to shareholders.

Issuers should also look to raise incremental debt, which enables them to refinance expensive second lien debt and add cash to the balance sheet for future M&A. As of December 18^th, YTD incremental / add on volume was up 71.16% from the full period the year prior, from $50.77 billion to $86.90 billion. There are several recent examples of Jefferies facilitating incremental debt transactions including:

• Jefferies was Lead Left Arranger on Summit Behavioral’s $200 million incremental First Lien Term Loan, with proceeds used to refinance the company’s Second Lien Term Loan.

• Summit Behavioral Healthcare is a behavioral health services provider with a focus on substance use disorders and acute psychiatric treatment.
• The incremental First Lien Term Loan priced at S+CSA+475, 0.75% floor and 99.25 OID.
• Due to strong market demand the add-on priced tight of talk.

• Jefferies was Sole Bookrunner on the recently completed $200 million add-on for Icahn Enterprises to the Company’s existing 9.750% Senior Secured Notes.

• Jefferies priced $500 million of 5-year Senior Notes on December 12^th and was able to tap the market a few days later for an additional $200 million on December 15^th.
• Icahn Enterprises took advantage of the strong market to clean up its capital structure by refinancing its existing notes due in 2024 while adding additional cash to the balance sheet.

• Jefferies was Sole Arranger on Fairbanks Morse Defense’s $210 million non-fungible incremental First Lien Term Loan, with proceeds used to refinance an acquisition bridge loan, pay down the company’s ABL revolver, and add cash to the balance sheet for general corporate purposes.

• Fairbanks Morse Defense, backed by Arcline Investment Management, provides propulsion systems, ancillary power, motors and controllers for the US Navy and US Coast Guard.
• The First Lien Term Loan priced tight of talk at S+CSA+525, 0.75% floor and 98.0 OID.
• The Loan was met with strong lender demand and was upsized by $25 million in market