Chemours debt in focus, higher in wake of $5.1 million verdict; Texas Competitive taps loan market

By Stephanie N. Rotondo

Seattle, July 7 – Trading in Chemours Co. bonds took up the bulk of activity in the distressed debt market, as liquidity in the space remained largely subdued.

“There’s not a ton” of distressed trading, one trader remarked.

Chemours’ debt was trending higher on Thursday, despite news that the company had been slapped with a $5.1 million judgment against it and its former parent, DuPont.

The stock (NYSE: CC) was also heading higher, though it had collapsed as much as 22% on Wednesday, right after the verdict was announced.

A trader saw the 6 5/8% notes due 2023 rising 5½ points to 80½, while the 7% notes due 2025 ticked up 2 to 78 3/8.

“It doesn’t look good,” the trader said of the news. “But maybe it’s not as bad as they thought.”

As for the equity, it improved by 63 cents, or 10.62%, closing at $6.56.

Late Wednesday, it was reported that Chemours and its former parent were found liable in an employee’s lawsuit that alleged his exposure to certain chemicals used to make the company’s Teflon products had resulted in the employee contracting testicular cancer.

The suit is one of thousands of similar cases brought against the companies.

Technically, DuPont was the liable party, but Chemours – spun-off from DuPont in July 2015 – is the one financially responsible.

The company has said it will appeal the ruling.

Texas Competitive shopping loans

Texas Competitive Electric Holdings Co. LLC set a bank meeting for 1 p.m. ET in New York on Tuesday to launch $3.5 billion in covenant-light term loans, according to a market source.

The debt is split between a $2.85 billion term loan B and a $650 million term loan C, the source said.

Deutsche Bank Securities Inc., Barclays, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, RBC Capital Markets, UBS Investment Bank and Natixis are leading the financing, which is a DIP roll-up that will convert to an exit facility.

The company disclosed recently in its debt commitment letter that, along with the term loans, it expects to get a $750 million revolver.

Texas Competitive is a Dallas-based power generation company.

Sara Rosenberg contributed to this article.

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