Deutsche Bank down as cuts enacted; Hornbeck lower after credit facility announcement

By James McCandless

San Antonio, July 8 – As a new week started in the distressed space, no single industry garnered the market’s focus.

Deutsche Bank AB’s notes declined after the company announced that it would be shuttering its equities trading division and making cuts to its investment banking arm.

Elsewhere, in energy, Hornbeck Offshore Services, Inc.’s issues moved lower after announcing a new senior credit facility.

Amid mixed oil futures, Ensco Rowan plc, Superior Energy Services, Inc. and Weatherford International plc’s paper also saw varied movements.

In telecom, DISH Network Corp.’s notes rose as the company inches closer to buying assets from T-Mobile as part of a divestiture deal.

Sector peer Frontier Communications Corp.’s issues trended positive.

Metals name United States Steel Corp.’s paper was losing amid more publicity over the current trade climate.

Another steel name, AK Steel Holding Corp., saw its notes end mixed.

Deutsche Bank declines

Deutsche Bank’s notes were declining on Monday, traders said.

The 4 7/8% senior subordinated notes due 2032 lost 1½ points to close at 87¼ bid.

Over the weekend, the Frankfurt-based financial services company announced an overhaul of its operations in an effort to reverse a downturn.

The name will shutter its equities trading division and slash 18,000 jobs in its investment banking segment.

It also is suspending its dividend for 2019 and 2020.

It will also take an $8.3 billion restructuring charge.

“It doesn’t exactly fit the definition of distressed but this paper has been treading water for a while,” a trader said.

The company has been under scrutiny by market and financial regulators in ongoing money-laundering probes.

Hornbeck lower

Meanwhile, in the energy space, Hornbeck’s issues moved lower, market sources said.

The 5 7/8% senior notes due 2020 lost 1½ points to close at 61 bid.

The Covington, La.-based oilfield services name announced early Monday that it had entered into a new $100 million senior secured asset-based revolving credit facility.

The facility is secured by first-priority liens on certain eligible receivables, certain restricted cash amounts and related assets.

The company’s structure has been under pressure for the better part of a year after posting a string of quarterly losses that started in November 2018.

It also faces industry constraints such as oil price fluctuation and competitor bankruptcies.

Oil mixed

Oil futures started out the week mixed as energy tranches were similarly skewed, traders said.

London-based contract driller Ensco’s paper saw a mixed session.

The 5.2% senior paper due 2025 shaved off ½ point to close at 73½ bid. The 7¾% paper due 2026 added 1¾ points to close at 76½ bid.

Houston-based oilfield name Superior Energy’s notes were also mixed.

The 7 1/8% senior notes due 2021 dropped ½ point to close at 70 bid. The 7¾% notes due 2024 tacked on ½ point to close at 66½ bid.

Baar, Switzerland-based peer Weatherford’s issues were declining.

The 8¼% senior notes due 2023 lost ¼ point to close at 49¼ bid.

West Texas Intermediate crude oil futures for August delivery gained 15 cents to end the session at $57.66 per barrel.

North Sea Brent crude oil futures for September delivery settled at $64.11 per barrel after a 12-cent loss.

DISH, Frontier rises

Elsewhere, in telecom, DISH’s paper was on the rise, market sources said.

The 2 3/8% senior paper due 2024 edged up ¼ point to close at 93¼ bid.

Last week, news broke that the Englewood, Colo.-based pay-TV provider had struck a divestiture deal with mobile phone name T-Mobile.

Dish hopes to acquire assets from T-Mobile to strengthen its position in the mobile space and clear a path for T-Mobile to merge with Sprint.

“It’s not a done deal yet,” a trader said. “Everyone’s waiting for this to be approved.”

Norwalk, Conn.-based wireline communications name Frontier’s notes also saw positive movement.

The 10½% senior notes due 2022 added 1 point to close at 66¼ bid. The 11% notes due 2025 gained 1½ points to close at 62½ bid.

U.S. Steel loses, AK Steel mixed

In the steel space, U.S. Steel’s issues saw a losing day, traders said.

The 6¼% senior notes due 2026 declined 1¼ points to close at 91¼ bid.

The Pittsburgh-based steel manufacturer’s notes saw heightened attention on Monday amid negative publicity on the toll that the increasingly unpredictable trade climate has had on the company.

“There was a story or two floating around today on how much value they’ve lost and how much the industry has lost,” a trader said. “That’s made it topical again.”

West Chester, Ohio-based sector peer AK Steel’s paper finished mixed.

The 7% senior notes due 2027 slid 1 point to close at 81¼ bid. The 6 3/8% notes due 2025 garnered 2 points to close at 84¼ bid.

© 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.