Banks remain resilient in the face of junk debt concerns, successfully selling $3.8 billion Citrix bonds.

Banks remain resilient in the face of junk debt concerns, successfully selling .8 billion Citrix bonds.



Goldman Sachs Group Inc and a group of banks are planning to hold an investor call on Monday to sell $3.8 billion in Citrix Systems bonds, marking a significant turnaround in the junk debt market following last month’s banking crisis that left it frozen. This sale, the largest of its kind since recent bankruptcies and forced sales, signifies a thawing in the market.

The junk bond market suffered a decline in issuance from $13.9 billion in February to $4.45 billion in March, reflecting decreased risk appetite due to market turmoil. BlueBay Asset Management senior portfolio manager Tim Leary noted the incredibly quiet nature of the leveraged financial market this year.

The new bonds being offered by Citrix will be used to refinance a $3.95 billion unsecured bridge loan that had helped facilitate a private equity acquisition of the cloud software maker. The 6.5-year bonds, which have a 9% coupon rate and are non-redeemable until September 2025, will be presented to investors through a call on Monday and presentations on Tuesday.

Goldman Sachs is leading a group of 33 banks, including Bank of America, Credit Suisse, Barclays, Citibank, and Deutsche Bank, in this sale. Last year, banks sold $8.55 billion in Citrix buyout debt to investors but incurred losses as interest rates rapidly rose. Following the upcoming Citrix bond sale, the next focus for banks may be marketing a portion of the debt that financed Apollo Global Management’s acquisition of auto parts supplier Tenneco.

Neither Citrix, Vista, Evergreen, nor Goldman Sachs commented on the matter. The organizations remain prepared to provide more information as the investor call takes place and the bond sale progresses.

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