SandRidge bonds slide ahead of secured deal; Caesars busy, higher; Alpha convertibles fall

By Paul Deckelman

New York, May 28 – SandRidge Energy, Inc. was the big name in the distressed-debt realm on Thursday after the oil and natural gas producer announced plans to sell $1 billion of five-year senior secured notes, which would rank above the existing bonds in the company’s capital structure.

Those existing bonds slid multiple points in very active trading.

Also in the energy space, Midstates Petroleum Co.’s notes continued to ease – also on subordination concerns – following last week’s announcement of new debt and other balance-sheet transactions.

Caesars Entertainment Operating Co.’s notes were seen better a day after the bankruptcy court overseeing its restructuring ruled that the troubled Las Vegas-based gaming giant could have additional time to devise a reorganization plan.

Verso Paper Corp. was seen under pressure for a second consecutive session.

In the convertibles market, Alpha Natural Resources Inc.’s paper continued to lose ground, with traders describing a mixture of investor angst about the beleaguered coal space combined with worries over whether the company would be able to make scheduled interest payments that come due next week on two of its straight junk bonds.

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