Intelsat Jackson rallies ‘across the board’; iHeartCommunications rises on upgrade; Freeport up, Murray down

By Colin Hanner

Chicago, Feb. 13 – It was more of the same as trading resumed on Monday in the distressed market, with focus continuing to be in tune with regular high-yield issues, though a distressed name ticked higher as its earnings announcement approaches.

Satellite telecommunications Intelsat Jackson Holdings SA was “higher across the board” during the session, a trader said, as four series of distressed notes posted multi-point gains.

“I guess the space is better in general,” a trader said of why there were such sharp increases, while another trader said there may be heightened trading because of earnings expectations next week.

In addition to the Jackson-held notes, Intelsat Luxembourg Holdings SA saw a small bump in one series of its distressed notes, a trader said.

Media company iHeartCommunications, Inc. ticked higher in two series of notes on a session where one of the major ratings agencies lifted the company’s rating.

Gold, silver and copper producer Freeport-McMoRan, Inc. was up in one of its long-term notes, a market source said.

“Metals have been on a nice little run here,” the source said.

In the exploration and production sector, movement was mixed, though two offshore marine transportation companies were up on the session.

A pair of chemical companies were up modestly on the session, Navios Maritime Holdings, Inc. was largely unchanged, Murray Energy Corp. traded down on “a bunch of trades,” a market source said, and several idiosyncratic names traded on the first session of the week.

Intelsat rallies

When asked why Intelsat Jackson’s several issues were having a field day in the distressed debt market, a trader said it could be because of the company’s plan to announce quarterly earnings soon.

Whatever the case, four series of Jackson-linked notes traded several points higher on day, led by the 7½% notes due 2021, which were up almost 3 points to 81, a trader said.

Following with similar gains were the 12½% notes due 2022, which were up 2½ points to 69½. The 7¾% notes due 2021 mirrored the 2½ point gain and finished with a 37½ handle, a market source said.

Rounding out the gains were the 7¼% notes due 2019, which were up 2 points to 89, a trader said. Another trader said they were up 1½ to 2 points to the same level.

In the company’s Luxembourg-linked issues, the 7¾% notes due 2021 were up ½ to 1 point, according to one trader, who said they went out the door with a 37½ handle.

iHeart trades tight

Not even a week after it downgraded iHeartMedia, Inc. and iHeartCommunications, S&P raised the credit rating for the media company to CCC from selective default (SD)

Several notes followed with gains on the session.

The 14% notes due 2021 were up 3/8 point to 38¾, a trader said, while the 9% notes due 2019 were up ¼ point to 85.

“We believe iHeartMedia may look to exchange debt at subpar levels or repurchase debt at discounted levels in 2017, which we would view as tantamount to default, based on our criteria,” said S&P credit analyst Jeanne Shoesmith in a news release. “We could lower our ratings on the company if it announces a subpar debt tender offer.”

Freeport heats up

Capitalizing on the continuing fruitful copper market – it has jumped 11% this year alone – Freeport McMoRan saw a gain on the session in its 5.45% notes due 2043, a trader said.

The notes jumped 1½ points to 87 7/8.

In E&P

Offshore transportation companies posted gains on the day, a trader said, led by Houston-based GulfMark Offshore, Inc., whose 6 3/8% notes due 2022 were up 1 point to 68.

Covington, La.-based Hornbeck Offshore Services, Inc. mirrored the 1 point gain of GulfMark, though finished with a 72¼ handle, a market source said.

And offshore ultra-deepwater driller Pacific Drilling Co.’s 5 3/8% notes due 2020 were down 1 point to 48, a trader said.

Calumet, Hexion rise

Two chemical companies saw gains on the day, led by Columbus, Ohio-based Hexion Inc., which posted a ¾-point gain in its 9% notes due 2020, which finished at 76¾, a trader.

Those same notes saw a 1-point gain on Friday’s session.

Seeing a modest bump were Calumet Specialty Products Partners, LP’s 6½% notes due 2021, which were up 1/8 point to 86¾.

One-off wrap-up

Seeing a “bunch of trades” were St. Clairsville, Ohio-based Murray Energy Corp.’s 11¼% notes due 2021, which were down 1¼ points to 75, a trader said.

Global shipper Navios Maritime Holdings’ 7 3/8% notes due 2022 were unchanged at 71¾, a market source said.

J.C. Penney Co., Inc. was one of the more notable retailers in the distressed arena, shaking up an area dominated by Neiman Marcus Group, Inc. in the past week.

The apparel and home furnishings retailer saw about a 1/8 point gain in its 7.4% notes due 2037, a trader said.

Rent-to-own company Rent-A-Center Inc.’s 6 5/8% notes due 2020 were down 1/8 point to 84½, a market source said.

And in health and pharma, hospital operator Community Health Systems, Inc.’s 8% notes due 2019 were up ½ point to 89½, while Concordia International Corp.’s 9% notes due 2022 were unchanged at 88, a trader said.

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