The U.S. leveraged loan market is under pressure and several transactions are forced to be withdrawn.

The pressure in the US leveraged loan market continues to increase, with a second transaction being pulled this week. In addition, in order to facilitate the completion of transactions, several adjustments had to be made to cater to investors. The latest "victim" is pharmaceutical company Mallinckrodt. According to sources, the company shelved a $1.49 billion loan issuance plan on Friday. This withdrawal follows the cancellation of financing by specialty chemicals producer Nouryon earlier this week. Data shows that since August, 8 transactions have been forced to withdraw. Mallinckrodt's loan was originally planned as a "repricing" transaction, which would have lowered its borrowing rate by up to 0.75 percentage points. The transaction was introduced on Monday, and investors were originally required to submit their subscription intentions by Thursday. In recent weeks, demand for high-risk debt has significantly weakened for various reasons. Firstly, there has been an increase in debt issuances related to mergers and acquisitions, offering investors potential returns higher than those of "repricing" loans. Additionally, the bankruptcy announcement of auto parts supplier First Brands Group after failing to complete a $6 billion refinancing has caused fear among some investors. Concerns about rising costs in the chemical industry have also dampened investor interest in the Nouryon financing project. Meanwhile, data shows that prices in the secondary market for US leveraged loans have been declining almost every day for the past two weeks. In another transaction, a bank completed a leveraged loan sale to support MJH Life Sciences' acquisition financing, but due to investors becoming increasingly picky about high-risk debt, the underwriting bank had to offer one of the deepest discounts this year to attract buyers. A group of banks led by Santander Bank in Spain will be forced to retain part of the $2.7 billion financing to support another acquisition.