Kohlberg Kravis Roberts & Co.'s bankers have found buyers for the highest-yielding loans financing its purchase of U.K. pharmacist Alliance Boots in a sign demand for credit may be improving.
Deutsche Bank AG, JPMorgan Chase & Co. and UniCredit SpA, which last month abandoned selling 6 billion pounds ($12 billion) of mostly senior loans, probably will next week finish syndicating 750 million pounds of mezzanine debt that ranks last for repayment, two bankers involved said.
KKR's eight underwriters have been saddled with all of the 9 billion pounds of debt financing Europe's biggest leveraged buyout after investors rejected high-risk, high-yield loans. Banks in the U.S. are attempting to raise $16 billion of loans for KKR's acquisition of First Data Corp. in the biggest debt sale since rising U.S. mortgage defaults led to the highest borrowing costs for buyout firms in four years.
This, combined with the Countrywide release and the commercial paper news release from the Fed are all encouraging signs.