Diebold notes dip as new issues trade; Occidental eyed amid early tender results

By James McCandless

San Antonio, July 10 – As the week came to a close in the distressed debt market, the activity centered on commerce and energy.

Diebold Nixdorf, Inc.’s notes dipped as its newest pricing of two tranches of five-year senior secured notes started trading.

In the oil and gas space, Occidental Petroleum Corp.’s issues varied in trading after the company disclosed early results of a tender offer.

Despite a positive push for oil futures, Whiting Petroleum Corp.’s, SM Energy Co.’s and Antero Resources Corp.’s paper diverged in direction.

Elsewhere, housewares name Tupperware Brands Corp.’s notes improved despite receiving a ratings downgrade.

Drug store chain Rite Aid Corp.’s issues were under pressure after releasing the early results of its exchange offer.

Sector peer L Brands, Inc.’s paper yielded mixed results.

Meanwhile, United Airlines Holdings, Inc.’s notes were under pressure after a week of negative headlines.

Diebold dips

Diebold’s notes dipped to put a pin in the week, traders said.

The 8½% senior notes due 2024 declined by 3¼ points to close at 84¾ bid.

On Friday, the North Canton, Ohio-based connected commerce solutions company’s two tranches of five-year senior secured notes saw their first full day of trading.

The 9 3/8% notes due 2025 were seen ending the session in the 101 context.

After being marketed earlier in the week, the $700 million of 9 3/8% notes priced on Thursday while its European counterpart Diebold Nixdorf Dutch Holding BV sold €350 million of 9% notes to yield 9 1/8%.

“Those came out of the gate at 99 yesterday, so they firmed up today,” a trader said.

The company wants to use the proceeds from the offering and cash on hand to repay part of the amounts outstanding under its senior credit facility, eyeing all amounts outstanding on its term loan A facility and term loan A-1 facility and about $194 million of revolving credit loans.

Diebold also wants to push back the maturities on its revolving credit commitments and loans.

Occidental varies

In the oil and gas space, Occidental Petroleum’s issues varied, market sources said.

The 2.9% senior notes due 2024 shaved off ¼ point to close at 89½ bid. The 2.7% senior notes due 2022 picked up ½ point to close at 94½ bid.

On Friday morning, the Houston-based independent oil and gas producer gave the early tender results in its cash tender offers and consent solicitations for $2 billion of nine series of notes due 2021 and 2022, Prospect News reported.

The offering was originally set at up to $1.5 billion on June 25.

As of the early tender deadline on June 9, almost $2 billion had been tendered and accepted for purchase from four series of notes.

Oil names eyed

Despite a positive push for oil futures as the week concluded, distressed tranches diverged in direction, traders said.

Futures were lifted after the International Energy Agency improved its 2020 oil demand forecast by 400,000 barrels per day.

West Texas Intermediate crude oil futures for August delivery collected 93 cents to settle the week at $40.55 per barrel.

North Sea Brent crude oil futures for September delivery capped Friday at $43.24 per barrel after an 89 cent gain.

Denver-based producer Whiting Petroleum’s paper took different tracks.

The 6¼% senior notes due 2023 were docked 1 point to close at 16 bid. The 6 5/8% senior paper due 2026 shot up 3 points to close at 18 bid.

SM Energy, another Denver-based peer, was also active.

The 6 1/8% senior notes due 2022 gained ½ point to close at 75½ bid. The 6 5/8% senior notes due 2027 slipped ¼ point to close at 51¼ bid.

Denver-based E&P Antero Resources’ issues took different directions.

The 5 5/8% senior notes due 2023 rose 1¼ points to close at 65½ bid. The 5% senior notes due 2025 chalked off ¾ point to close at 59½ bid.

Tupperware up

Elsewhere, housewares name Tupperware’s paper improved, market sources said.

The 4¾% senior notes due 2021 grabbed 3 points to close at 66½ bid.

The Orlando, Fla.-based marketer of household products received a ratings downgrade early Friday.

S&P Global Ratings lowered its overall rating to SD from CC and its $600 million of senior unsecured notes to D from C.

The agency said that the cut is its response to the company’s recently completed tender offer for about $97.6 million of its $600 million notes, which it considers to be a distressed exchange.

S&P anticipates another restructuring measure or exchange in the future.

The tender offer concluded on July 9.

Rite Aid down

Retailer Rite Aid’s notes were under pressure by the end of the afternoon, traders said.

The 6 1/8% senior notes due 2023 trailed by 1½ points to close at 96½ bid.

As the market opened on Friday, Camp Hill, Pa.-based drug store chain announced early results and increased the maximum amount and exchange consideration of its June 25 exchange offer for its 2023 notes, Prospect News reported.

The amount that can be exchanged has been increased to $1.125 billion from $750 million, and the exchange consideration has been upped to $800 principal amount of new notes and $191.50 in cash per old note from $760 in principal amount of new notes and $184 in cash per bond.

The exchange started on June 25.

Columbus, Ohio-based department store name L Brands’ issues saw mixed results.

The 6¾% senior notes due 2036 tacked on ½ point to close at 84 bid. The 5¼% senior notes due 2028 declined by 1¾ points to close at 80¾ bid.

United lower

Meanwhile, air carrier United Airlines’ paper was under pressure, market sources said.

The 5% senior notes due 2024 lost 2 points to close at 79 bid. The 4¼% senior paper due 2022 shed ¼ point to close ta 85½ bid.

This week, the Chicago-based airline received negative attention after news broke on Wednesday that it was preparing to send 36,000 potential furlough notices to its frontline U.S. workers.

The number represents about 45% of United Airlines’ workforce.

Following the news, S&P Global Ratings cut the company’s issuer rating, senior secured debt rating and recovery rating.

© 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.