A&O Shearman advised on 12 high yield transactions across 20 tranches as the European high yield market experienced two consecutive record-breaking months in May and June of 2025. After a period of tariff-driven volatility in April, investor confidence rebounded sharply, resulting in tighter spreads and a surge in primary market activity.
Market sentiment improved significantly in May, following a spike in the iTraxx Crossover index above 425 basis points in April due to heightened geopolitical risk. By mid-May, the index had retraced below the 300-basis-point threshold, laying the groundwork for the busiest quarter in European high yield history.
Robust fund inflows into European markets during this period fueled strong demand for new issues, with solid supply-demand dynamics persisting despite ongoing geopolitical uncertainty. Most transactions priced inside initial guidance, including those with more challenging credit profiles, and several deals were upsized in response to significant oversubscription.
John Kicken, head of high yield at A&O Shearman, commented: "Due to increased volatility in the market, we are seeing more window-driven activity. Since the market reopened in May, three of the fifteen busiest trading days on record have occurred, underscoring the importance of being ready to execute when windows emerge. Alongside traditional bond refinancings, we are seeing a pronounced uptick in dual-tranche fixed/floating rate offerings, loan-to-bond refinancings, fund-to-fund transfers, and larger private placements designed to take advantage of favorable conditions."
Nick Clark, global co-head of debt finance at A&O Shearman, added: "These transactions showcase the depth and versatility of our high yield team, which sits at the core of our pan-European leveraged finance practice. As our clients face ever-changing market dynamics, we remain committed to delivering seamless, market-leading advice to issuers and underwriters across the full spectrum of high yield and leveraged finance products."
A&O Shearman's high yield team advised both issuers and underwriters on a diverse array of multi-currency refinancings and new money transactions, including:
- The initial purchasers on Centrient's EUR300m 6.750% senior secured notes due 2030 and EUR300m E+4.500% senior secured floating rate notes due 2030
- Trivium on its EUR700m 6.625% senior secured notes due 2030, USD600m 8.250% senior secured notes due 2030 and USD600m 12.250% second lien notes due 2031
- The initial purchasers on Punch Tavern's GBP640m 7.875% senior secured notes due 2030
- The initial purchasers on Q-Park's EUR300m 4.250% senior secured notes due 2030
- Bité on its EUR150m E+3.500% senior secured floating rate notes due 2031 and EUR50m 6.000% senior secured notes due 2031
- The initial purchasers on Asda's EUR700m 8.000% senior secured notes due 2031
- The initial purchasers on Techem's EUR610m 4.625% senior secured notes due 2032 and EUR540m E+3.000% senior secured floating rate notes due 2032
- Modulaire on its EUR600m 6.500% senior secured notes due 2031
- The initial purchasers on True Potential's GBP405m 7.750% senior secured notes due 2031 and EUR400m E+3.750% senior secured floating rate notes due 2032
- The initial purchasers on DOC Pharma's EUR590m 5.625% senior secured notes due 2032 and EUR400m E+3.625% senior secured floating rate notes due 2032
- Veon on its USD200m 9.000% senior notes due 2029