You'd think a firm that just sold off a $9.5 billion business would be in a strong spot to borrow.
Boyd Corp. is finding out that's not the case.
Boyd is a Boca Raton-based maker of adhesives, insulation, and engineered materials. It is now marketing a $530 million loan to refinance its debt.
The pricing on it is unusually painful. The interest rate is set 4.5 percentage points above the benchmark - a high premium for a Goldman-backed firm.
Buyers are also being offered the loan at as low as 92 cents on the dollar.
In bond and loan land, that price below face value is called an original issue discount. It is extra return paid upfront to make up for risk.
The bigger the discount, the more lenders are demanding to take part.
Just one leveraged loan in 2026 has priced below 92 cents, per data from Bloomberg. That makes Boyd's loan one of the most steeply discounted of the year.
That is happening even though Boyd just had a big payday.
In March, the firm sold its thermal cooling unit to Eaton for $9.5 billion. The deal was a big win for Goldman Sachs Alternatives, which has owned Boyd since 2018.
Eaton paid up for that unit because of the AI boom. Thermal cooling is a key part of how data centers handle the heat from chips, and Eaton wanted in.
Boyd's other unit, engineered materials, now runs on its own. It is still backed by Goldman.
For a sponsor sitting on billions in fresh cash, having to cut the loan price this hard is an odd look.
A steep discount on a refinance loan can mean a few things at once. Lenders may be worried about the risk of getting paid back. They may be pricing in higher rates ahead. Or they may simply have more options on the table.
A leveraged loan is a floating-rate loan to a firm that already carries a lot of debt. These loans are mostly bought by big funds and tend to lead the wider credit market.
The leveraged loan market has tightened in the past few months. Defaults have ticked up, and more deals are being priced with sweeter terms to find buyers.
The trend is also tied to rates. With the Fed on hold and short-term rates still high, a floating-rate loan can get costly fast.
Whatever the cause, Boyd is paying up. Even big names with cash in hand are not getting easy money right now.
The Boyd loan is one to track for what it says about the rest of the market. A Goldman-backed firm with $9.5 billion of fresh proceeds still being forced to discount this hard is not a small signal.
Investors in private credit and loan funds should brace for more deals like this. The market may tighten before it eases.
If Boyd's pricing holds, weaker firms are going to feel the squeeze even more. Smaller sponsors that need to refinance this year may see worse terms than Boyd is getting now.
