Blockbuster 'pops' ahead of earnings; CIT active, unchanged; Visteon gains; broad market firms

By Stephanie N. Rotondo

Portland, Ore., May 12 - Distressed debt was "generally better" on Wednesday, a trader said.

But even though the market was "stronger," he noted that it was "harder to trade anything."

"The market is almost back to where it was," he said and, "in that event," he expected investors were waiting for the calendar.

Another trader said there was "huge volume" in the secondary world, but that it was spread out over more names than usual.

"A lot of different crap changed hands, but [it was] onesies and twosies of hundreds of different things. Nothing really jumped out."

Blockbuster Inc.'s debt benefited from the firmer marketplace. Traders saw the company's bonds gaining about 2 points on the day, as investors prepared to hear how the company fared in the first quarter.

In the financial realm, CIT Group Inc. was one of the day's most active credits, according to market sources. However, the sources noted that price movement was minimal.

The automotive sector also got a boost. Visteon Corp.'s paper, for example, ended up a couple of points, possibly helped in part by the happenings of its bankruptcy case.

Blockbuster 'pops' ahead of earnings

Blockbuster's bonds "seemed to have popped," a trader said, ahead of the company's earnings release after the market closes Thursday.

The trader said there was "a lot of trading" in the 9% notes due 2012 at 21 bid, 22 offered. That compared to levels around 19 on Tuesday.

"Must be position closings," he speculated.

Another trader said the debt was "up a bit," also in that 21 to 22 range. He added that about "$20-odd million" of the paper changed hands.

The second trader also saw the 11¾% notes due 2014 "up and down" 69, noting that the bonds were quoted into the 70s.

And another trader said the notes were "moderately active" round the 22 mark.

Blockbuster is a Dallas-based movie rental chain.

CIT active, but unchanged

There was "a lot of activity in CIT paper," according to a market source. However, he remarked that there wasn't much movement in terms of price.

The source said the 7% notes due 2017 were "probably the most active," trading between 91½ and 921/2.

"They were unchanged to maybe up half a point to a point," he said. "They were kind of all over the place."

Another trader said somewhere around $100 million of the notes turned over, ending "kind of right where it's been" at 921/2.

But another distressed debt player said the bonds were "up a good point, depending on which flavor you're looking at," pegging the 7% notes at 92¼ bid, 92¾ offered.

There was no news out on the New York-based lender to explain the heavy volume. However, CIT debt has been trading actively for the past week or so and could simply be due to the vast array of issues available and the liquidity of said debt.

Visteon debt gains

The judge overseeing Visteon's bankruptcy case extended the company's exclusive right to propose a reorganization plan, rebuffing shareholder attempts to offer their own plan.

As a result, a trader said the Van Buren Township, Mich.-based company's bonds ended the day "up a couple points."

The trader quoted the 8¼% notes due 2010 and the 7% notes due 2014 at 114 bid, 115 offered.

Another trader saw the bonds trading in a 113 to 115 range, though he noted there were "not a lot of trades."

Elsewhere in the autosphere, Cooper-Standard Automotive Inc.'s recent issue - the 8½% notes due 2018 - finished the session at par ½ bid, 101½ offered, a trader said. He said that the bonds have not traded much over the course of the week, but added that he saw the paper at 99 bid, par ½ offered on Friday.

Cooper made headlines Wednesday as the company said it was aiming to exit Chapter 11 protections by the end of the month.

And, General Motors Corp.'s benchmark 8 3/8% notes due 2033 "traded up some more," a source said, to end around 36.

Broad market generally better

Also in distressed debt territory, Sorenson Communications Inc.'s 10½% notes due 2015 were deemed "better" by a market source. The source quoted the notes at 68 bid, 70 offered.

Harrah's Entertainment Inc.'s 10% notes due 2018 remained active, another trader said, placing the bonds around the 84 mark.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.