Deals

Trap In Store for Bond Investors Who Skipped the Small Print

  • CoC clauses could spring 1 billion euros of losses on holders
  • HSBC identifies 44 issuers at risk of leveraged buyouts
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Investors of top-tier bonds probably haven’t paid much attention to covenants in recent years. They may want to start.

An era of rising prices has laid a trap for holders of investment-grade notes that carry change-of-control clauses. And a boom in leveraged buyouts is threatening to spring it, according to HSBC Holdings Plc.