When one corporate treasurer with experience in investment-grade bond deals stepped into the high-yield debt market for the first time, she leaned on the advice of Chatham Financial to navigate the unfamiliar terrain. The result: a better-structured deal, tighter pricing and a stronger sense of control. - At NeuGroup’s recent Treasurers Symposium co-sponsored by Chatham, the member presented alongside Reuben Daniels, the firm’s managing director and global head of investment banking, who help guide the company during a complex transaction that included both euro and U.S. dollar tranches.
- Bringing in external expertise provided a significant edge in execution and helped the treasurer negotiate lower fees with banks. “We got a much better result than the banks first projected when we started. I can sleep at night now,” she said.
When terms don’t add up. Early in the process, the treasurer began questioning the initial terms offered by lead banks. She said the fees differed from those in comparable recent deals, which made clear to her that the team needed additional support.
- “I presented why work with Chatham, my vision for the deal and why we needed an independent advisor,” she said. “I’m blessed to have a supportive chair of our board.”
- The team brought in Chatham and quickly adopted a dual-tranche structure, leveraging a stronger credit rating in its European entity to go to market overseas first. The decision, and the advisor’s involvement, sparked some pushback from U.S. banks—but she said Mr. Daniels’ advice “paid off in spades.”
The Chatham impact. With Chatham providing real-time market analysis, the treasurer recognized a narrowing window to price favorably in Europe. “She asked, ‘Why not go today?’” recalled Mr. Daniels. “That moment of confidence helped us move quickly and catch the euro market at the right time, then follow on with the dollar deal.”
- Throughout the process, Chatham also helped the company navigate a negotiation to lower bank fees while preserving strong relationships with the banks. Mr. Daniels said the result not only improved economics on the deal but also set a favorable benchmark for future issuance.
Navigating high-yield seas. The treasurer, though new to high yield, brought a disciplined mindset shaped by her investment grade background. That became evident when she asked to see the investor order book for the dollar tranche, a common ask in IG deals but unfamiliar territory for high-yield bankers.
- “They told us no one ever asks for that,” she said. “But it’s a simple request.” With support from Chatham, the member pressed forward and got the transparency she needed to stay in control of the process.
Benefits of an outside perspective. Other members in the session echoed the value of having a sharp, independent capital markets advisor. One treasurer with an FX background but limited debt market experience said bringing in Chatham helped him level the playing field in conversations with banks.
- The company was in the midst of a large refinancing, and when it came time to lock in pricing, the advisor “provided templates and guidance that helped me structure conversations and manage the process,” the member said. “We saved twice the cost by engaging Chatham.”
