(Bloomberg) -- Mergers and acquisitions are already padding the debt pipeline for 2021, adding momentum to a pace of bond sales that’s slowed from a blistering start to the new year.

LafargeHolcim Ltd. and AmerisourceBergen Corp. are among the latest to announce deals that will be financed with debt, echoing similar plans from Centene Corp. and Teledyne Technologies Inc. earlier in the week. The disclosures come after nearly $50 billion of new high-grade offerings kicked off 2021, more than double some estimates.

Dealmaking is picking up right where it left off at the tail end of 2020, when more than $187 billion of deals globally came during the last two weeks of December. That’s the most ever for that period, according to data compiled by Bloomberg, and many of those will be funded with new borrowing.

While debt issuance is widely expected to drop after shattering records last year, obligations earmarked for M&A should pick up, according to CreditSights. Such proceeds only made up 5% of 2020’s high-grade supply, while the proportion was 10% to 20% in each of the prior five years, the research firm said in a Dec. 23 report.

LafargeHolcim is buying Bridgestone Corp.’s Firestone Building Products unit for $3.4 billion with cash and debt, while AmerisourceBergen will use a mix of similar funding to purchase a unit of Walgreens for about $6.5 billion. Centene and Teledyne have already arranged bridge loan commitments for their respective acquisitions, which are typically refinanced with longer-term bonds.

If this week is any indication, the debt sales should be well received. High-grade borrowers have largely been able to borrow at a similar rate to their outstanding debt, offering just half a basis point of new issue concession on average this week through Jan. 6, according to data compiled by Bloomberg. That compares to 10.4 basis points in 2020.

This week got off to a busy start with 20 companies borrowing nearly $40 billion in the first two trading sessions, prompting some to up their estimates. The pace has since slowed as the blue wave election outcome has reinforced stimulus expectations and steepened Treasury curves, requiring issuers to acclimate to the changing funding landscape.

Just three companies were looking to tap the U.S. high-grade market Thursday, according to an informal survey of debt underwriters. A measure of credit risk is easing after a day of violence rocked the U.S. Capitol, with investors firmly focused on the prospect for more fiscal spending.

In Europe, Bayer AG is leading a rebound in new debt sales, as the region returns from a holiday and markets calm after Wednesday’s tumult in Washington. The pharmaceutical company is selling notes as long as 15 years in its first offering since July, with the European Investment Bank and Spanish lender Abanca Corp Bancaria SA also among the day’s 11 borrowers.


Radio broadcaster Urban One is selling junk bonds, the second CCC rated borrower this week. Yields on bonds in the weakest ratings tier are at the lowest since 2014.

  • Marathon Asset Management, the $20 billion distressed-debt firm, raised $2.5 billion for a new fund focused on struggling companies, according to a person with knowledge of the matter
  • For deal updates, click here for the New Issue Monitor
  • For more, click here for the Credit Daybook Americas


Issuance volume will reach at least 11.2 billion euros equivalent ($13.7 billion) on Thursday, with Nordic Investment Bank and National Grid Gas Plc also among the day’s issuers.

  • National Grid is following Wessex Water with a pound-denominated corporate bond deal this week
  • Barclays’s corporate DCM head for Europe Charlotte Weir told Bloomberg News that more U.K. corporates will bring sterling deals in the “next weeks.” The market has “shrugged off” Brexit and Covid concerns, she said
  • The region’s junk-rated companies plan to raise around 20 billion euros from bonds and loans in early 2021, with most of the proceeds used to fund acquisitions


Chinese borrowers continued to dominate Asia’s primary dollar bond market on Thursday with hot-pot restaurant Haidilao and two financial institutions joining developers in a deal rush.

©2021 Bloomberg L.P.