Assemblin Caverion on Sept. 16 priced the second-largest euro-denominated floating-rate note (FRN) ever sold by a European high yield borrower, after the Stockholm-based technical installations group upsized its planned seven-year deal to €1.53 billion.
The bumper deal — which cleared at E+300, offered at par — is the largest euro FRN tranche since Wind Tre’s record-breaking €2.25 billion deal back in 2017. It tops a €1.375 billion Nexi bond from 2018 and a €1.25 billion trade from TeamSystem last year.
Big slate
Assemblin Caverion’s offering was also the largest in a €4.53 billion slate of high yield transactions to price on Sept. 16 — which according to LCD, represents the busiest day of the year so far in volume terms for the European primary high yield market, and the sixth-busiest on record.
The mammoth size of the new offering for Assemblin Caverion mainly reflects the fact that the group is effectively merging a higher-cost €780 million E+350 FRN into the new tranche, a strategy commonly used by high yield borrowers whose existing debt is already callable.
The deal, originally sized at €750 million, nevertheless reflects strong demand for floating-rate paper from an issuer that already has both fixed- and floating-rate debt in its structure.
“We were surprised seeing FRNs only, but it is the environment we prefer as an investor,” said a manager at a high yield bond fund. He also said the fund has increased its allocation to floating-rate debt from 15% to about 20% in recent weeks, and plans to increase this allocation to roughly a quarter of the portfolio.
FRN buyers
The creation of new European CLOs — the core buyers of high yield FRNs — has meanwhile remained robust this year, with new issuance running roughly in line with 2025’s record volumes and new managers entering the market. While the number of warehouses open at any given time is difficult to quantify, speakers at S&P Global’s European Structured Finance Conference in September put the number at 200.
Assemblin Caverion was formed in 2024 after Triton merged its technical installations company Assemblin with Caverion, the Finnish construction systems group which the private equity firm took private the prior year for €1.12 billion. The bond deal will support a dividend to Triton.
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This article originally appeared on PitchBook News