Endo notes better on drug approval; Diebold Nixdorf trades higher as new notes offered

By James McCandless

San Antonio, July 7 – The focus of the distressed debt space shifted on Tuesday to pharmaceutical and commerce names.

Endo International plc’s notes saw better levels after the Food and Drug Administration approved its cellulite drug.

Sector peer Mallinckrodt plc’s issues were also lifted.

Elsewhere, connected commerce name Diebold Nixdorf, Inc.’s paper rose as the company preps a dual-currency offering of five-year senior secured notes.

Travel name United Airlines Holdings, Inc.’s notes were under pressure after warning of decreased demand and potential layoffs.

American Airlines Group Inc.’s issues varied in direction.

A small loss for oil futures spurred similar declines for Whiting Petroleum Corp.’s paper while Occidental Petroleum Corp.’s and SM Energy Co.’s notes diverged.

Meanwhile, GTT Communications, Inc.’s issues improved a day after announcing an interim chief executive officer.

Endo, Mallinckrodt better

Endo’s notes saw better levels throughout the Tuesday session, traders said.

The 6% senior notes due 2028 added 3¼ points to close at 68¼ bid.

The notes saw about $7 million change hands.

Late Monday, the Dublin-based generic pharmaceutical producer announced that it had received regulatory approval of new drug Qwo to tread moderate to severe cellulite in adult women.

The company said that the product would be launched in spring 2021 due to the coronavirus pandemic.

In its most recent earnings report in May, the company reported earnings of 95 cents per share, higher than the 54 cents per share profit projected by analysts.

Revenue was reported at $820 million, largely due to the 25% jump in sales of its sterile injectable products.

Staines-upon-Thames, England-based sector peer Mallinckrodt’s issues were also lifted.

The 4¾% senior notes due 2023 gained 2 points to close at 22 bid.

Diebold rises

Elsewhere, ATM name Diebold’s paper was on the rise, market sources said.

The 8¼% senior notes due 2024 garnered ½ point to close at 82 bid.

Starting on Tuesday, the North Canton, Ohio-based connected commerce solutions company started marketing a dual-currency offering of five-year senior secured notes that includes a $690 million tranche and €350 million tranche, Prospect News reported.

Pricing is expected on Thursday.

With the proceeds and cash on hand, the company plans to repay a portion of the amount outstanding under its senior credit facility.

Diebold intends to repay the total outstanding under its term loan A facility and term loan A-1 facility and about $194 million of revolving credit loans.

Concurrently, Diebold announced that it would amend its senior credit facility to extend the maturity of revolving credit commitments and revolving credit loans to July 2023 from April 30, 2022.

“The notes were hovering around an 82 context all day,” a trader said.

Airlines in focus

Travel name United Airlines’ notes were under pressure, traders said.

The 5% senior notes due 2024 dipped 2½ points to close at 82 bid. The 4¼% senior notes due 2022 fell 1¼ points to close at 87 bid.

Early Tuesday morning, reports indicated that the Chicago-based air traveler has warned its employees that new travel restrictions may lead to declines in passenger bookings and possible furloughs.

The company’s hub in Newark saw a precipitous drop in near-term net bookings, comprising about 16% of the level from this period last year.

Last week, United Airlines said that it would add 25,000 international and domestic flights to its schedule while committing to changing those plans based on coronavirus data.

Fort Worth-based carrier American Airlines’ issues varied in direction.

The 5% senior notes due 2022 dived 4¼ points to close at 56 bid. The 3¾% senior notes due 2025 held level at 48½ bid.

Oil names diverge

As oil futures experienced a small loss, distressed energy names saw diverging paths, market sources said.

West Texas Intermediate crude oil futures for August delivery shed 1 cent to finish at $40.62 per barrel.

North Sea Brent crude oil futures for September delivery settled at $43.08 per barrel after a 2 cent slip.

Denver-based independent oil and gas producer Whiting Petroleum’s paper declined.

The 6¼% senior notes due 2023 moved down 4¾ points to close at 16¼ bid. The 6 5/8% senior notes due 2026 chalked off 2½ points to close at 17¼ bid.

Houston-based producer Occidental Petroleum’s notes differed in direction.

The 2.9% senior notes due 2024 were docked ½ point to close at 89¼ bid. The 2.7% senior notes due 2022 closed level at 94¾ bid.

SM Energy, another Denver-based producer, saw its issues end with mixed results.

The 5% senior notes due 2024 shaved off ¼ point to close at 56¾ bid. The 6¾% senior notes due 2026 rose ¼ point to close at 52 bid.

GTT improves

Meanwhile, in telecom, GTT’s paper was seen improving, traders said.

The 7 7/8% senior notes due 2024 gained 3 points to close at 56½ bid.

The McLean, Va.-based cloud networking name announced on Monday that it had named chief revenue officer Ernie Ortega as interim CEO while a search is conducted for a permanent replacement.

Richard Calder, the previous CEO, announced his stepping down in late May.

In its most recent earnings report, the company showed a first-quarter loss of 79 cents per share and $424.7 million in revenue.

© 2015 Prospect News.
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