iHeart bonds trade up on restructuring news; Valeant perks up on asset sale; Endo, Frontier busy, better

By Stephanie N. Rotondo

Seattle, July 17 – The distressed debt market had a positive tone on Monday, even though trading volume continued to be limited.

“We’re just trying to stay awake until the end of the day,” a trader said. However, he added that “everything is up.”

While liquidity was muted, there was some fresh news out to move a couple of names around.

iHeartCommunications Inc., for instance, reported that restructuring negotiations with lenders were continuing.

The company also released details on their own restructuring proposal, as well as the counterproposal from the lenders.

The announcement helped the company’s debt trend higher.

Also taking the high road were Valeant Pharmaceuticals International Inc.’s bonds, on news the company had sold off another asset.

Elsewhere in the pharmaceutical space, Endo International plc’s paper “looked a little better,” according to one trader.

The trader saw the 6% notes due 2023 “moving just north of 85.”

Another trader called the issue half a point better at 85 3/8. He also saw the 5 3/8% notes due 2023 rising nearly a point to 84.

And, as has been the case of late, Frontier Communications Inc.’s debt was called active yet again – and better.

A trader saw the bellwether 11% notes due 2025 ticking up a touch to 89¾.

The trader said there were “a bunch of trades” in the issue.

The 7 1/8% notes due 2023 were also firm, closing at 79 1/8, he said.

At another shop, the 11% notes were seen in an 89½ to 90 context, deemed up half a point to three-quarters of a point.

iHeart trades better

A trader said that iHeart bonds were “up a bit on the news of negotiations between the company and some creditors.”

The trader saw the 9% notes due 2019 “around 79,” up 1½ points. The 14% notes due 2021 were deemed “the biggest mover,” rising “over 3 points” to 24.

Another trader called the 14% notes up 3½ points at 24½.

On Monday, the San Antonio-based multimedia company said it was still in talks with lenders on a restructuring proposal, giving details on both the company’s plan and a plan that lenders’ had provided. (See article: iHeartCommunications discloses restructuring proposals, talks go on.)

The terms on each proposal differ from those given in a public exchange offer that has been extended several times.

Investors have thus far not jumped on board the exchange.

Valeant rises

Valeant Pharmaceuticals’ debt got a boost Monday after the company said it was selling its Obagi Medical Products unit.

A trader said the 5 7/8% notes due 2023 rose three-quarters of a point to 87¼, while the 6 1/8% notes due 2025 were seen up almost a point at 86 3/8.

A second trader said the 5 7/8% notes were half a point to three-quarters of a point higher at 87¼.

The trader also saw the 6 1/8% notes “trading around 86.”

Valeant is selling Obagi to Shonghua Finance Acquisition Fund for $190 million. The sale marks the latest move by the company to lower its debt burden by $5 billion by February 2018.

© 2015 Prospect News.
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