Perelman’s Vericast Offers 12% Yield to Tweak Junk Debt Load (2)

Ronald Perelman’s Vericast Corp. is issuing $2 billion of new junk-rated debt, joining other distressed names in an frenzy unleashed by ultra-low borrowing costs.

The company, which provides marketing services and houses discount drug-company RXSaver, is offering $700 million of new second-lien notes and $1.3 billion of first-lien bonds, people with knowledge of the matter said Thursday. As part of negotiations with investors, Vericast tightened certain covenants and moved RXSaver to a restricted subsidiary, said the people. The business is now pledged to debt holders as part of the refinancing, they said.

Vericast is sounding out investor appetite for ...