PetSmart pummeled on Chewy spinoff fears; CenturyLink climbs as deal boosts shares

By Paul Deckelman

New York, Dec. 11 – PetSmart, Inc.’s several issues of bonds were the big losers on Monday, according to traders in distressed debt and in the bonds of otherwise underperforming companies and industry sectors.

They cited news reports indicating that the embattled retailer could spin off the company’s potentially lucrative Chewy online pet supplies business in order to pay a dividend to its private-equity sponsors.

Elsewhere, wireline telecommunications operator CenturyLink, Inc.’s issues firmed smartly, in line with a surge in the company’s stock driven by the news that it had signed a big contract with the state of Pennsylvania.

Valeant Pharmaceuticals International Inc.’s recently priced megadeal continued to firm smartly in active trading on Monday, a week after it came to market. The Canadian drug manufacturer’s existing issues were also seen better on busy volume.

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