HCP pulls $380m loan as US investors push back

Chinese packaging company pulls $380 million leveraged loan after US institutional investors demand higher yield.
HCP makes packaging for a variety of beauty products
HCP makes packaging for a variety of beauty products

Chinese packaging company HCP, held by private equity firm Texas Pacific Group TPG, has pulled its $380 million covenant-lite loan that targeted US institutional investors, signalling a pushback on pricing of high-yield loans sold by Asian companies.

According to a source familiar with the deal, the combination of rising geopolitical risk and a flight to safety meant that investors were demanding higher yields, which HCP was unwilling to pay.

Investor sentiment took a beating during the first week of August as Russia amassed troops on Ukraine’s border and European woes came to the fore, with Italy slipping back into a recession and Portugal bailing out...

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