With no open interest from market participants for physical settlement, the pricing of second-lien loans was determined following the initial bidding period, eliminating the need for a second phase of the auction process.
To avoid breaching the terms of its debt, British Vita agreed a standstill agreement with lenders in December, who gave the company until the end of March to examine its refinancing options.
This was the second cash-settlement auction held for European LCDSs, after settlement values for LCDS trades referencing Helsinki-based bathroom company Sanitec's first and second-lien loans were established on February 5. The auctions are the first to be held on reference obligations included in the Markit iTraxx LevX indexes of European LCDSs.
The week on Risk.net, August 19-25, 2016Receive this by email