Revlon notes decline as lenders sue; Antero Resources trades down on ratings action

By James McCandless

San Antonio, Aug. 13 – During the Thursday session, the distressed debt market saw shifting ground in the retail and energy spaces.

Revlon, Inc.’s notes were under pressure after a lender filed a lawsuit accusing the company of theft of collateral.

Sector peer L Brands, Inc.’s issues also saw negativity.

In the oil and gas space, Antero Resources Corp.’s paper was pushed down as its ratings were placed on notice.

With oil futures seeing declines, Transocean Ltd.’s notes moved similarly while Whiting Petroleum Corp.’s issues varied and Occidental Petroleum Corp.’s paper rose.

Meanwhile, vehicle renter Hertz Global Holdings, Inc.’s notes diverged in direction as it makes its way through the bankruptcy process.

Property names Washington Prime Group, Inc.’s and CBL & Associates Properties, Inc.’s issues were trailing.

Revlon, L Brands lower

Revlon’s notes were under pressure as the day ended, traders said.

The 5¾% senior notes due 2021 declined by 1 point to close at 22¼ bid. The 6¼% senior notes due 2024 gave up 2 points to close at 15¾ bid.

Late Wednesday, news broke that a lender has filed a lawsuit against the New York-based cosmetics producer alleging the company transferred about $1.8 billion in intellectual property.

The lawsuit, filed by UMB Bank, alleges improper transfer of intellectual property rights to collateral that was used for a loan to finance the acquisition of the Elizabeth Arden brand.

UMB also said a series of transactions starting in 2019, which also involves the collateral, coincided with lost market share.

The bank is seeking the forced return of the collateral.

“Revlon has been shredded this year,” a trader said. “Lenders are looking for a way to maximize value any way they can.”

In a statement, the company called the lawsuit meritless.

Columbus, Ohio-based department store chain L Brands’ issues also saw negativity.

The 6¾% senior notes due 2036 fell 2 points to close at 94¼ bid. The 5¼% senior notes due 2028 shaved off ¾ point to close at 90¼ bid.

Antero trades down

In the oil and gas space, Antero’s paper was pushed down, market sources said.

The 5 5/8% senior notes due 2023 lost 1¾ points to close at 77¼ bid. The 5 1/8% senior paper due 2022 gave back 1¾ points to close at 84 bid.

On Thursday, S&P Global Ratings placed some of the Denver-based independent oil and gas producer’s ratings on watch.

The agency singled out the company’s issuer and B senior unsecured ratings, which are on CreditWatch with negative implications.

The move comes after Antero announced a $525 million tender offer for its notes due 2021, 2022 and 2023.

S&P said that the tender for the 2022 and 2023 senior notes could be viewed as a selective default while the 2021 offer would not.

Ratings will be reevaluated following the exchange.

Oil names vary

With oil futures seeing declines, distressed energy tranches were pulled in multiple directions, traders said.

West Texas Intermediate crude oil futures for September delivery were dragged down 43 cents to finish at $42.24 per barrel.

North Sea Brent crude oil futures for October delivery closed at $44.96 per barrel after a 47 cent loss.

Steinhausen, Switzerland-based contract driller Transocean’s notes moved the same way as futures.

The 6½% senior notes due 2020 shed ¼ point to close at 99¼ bid. The 7½% senior notes due 2031 were pushed down 1½ points to close at 27 bid.

Denver-based producer Whiting Petroleum’s issues varied in direction.

The 6¼% senior notes due 2023 gained ½ point to close at 19 bid. The 6 5/8% senior notes due 2026 held level to close at 18½ bid.

Houston-based E&P Occidental Petroleum’s paper rose.

The 2.9% senior notes due 2024 picked up 1½ points to close at 93¼ bid. The 2.7% senior notes due 2022 inched up ¼ point to close at 97¼ bid.

Hertz diverges

Meanwhile, vehicle renter Hertz’s notes were seen diverging, market sources said.

The 6¼% senior notes due 2022 chalked off 1¾ points to close at 33 bid. The 5½% senior notes due 2024 rose ¼ point to close at 36¼ bid.

The Estero, Fla.-based company’s structure remains active as it works its way through the bankruptcy process.

On Tuesday, news broke that the company received court approval to use sidecar cash collateral to repay in full its pre-bankruptcy sidecar credit facility.

In Hertz’s recent earnings report for Q2, the company said it had a loss per share of $3.51 and revenues of $832 million.

The company is seeking debtor-in-possession financing.

Washington Prime eyed

Property name Washington Prime’s issues were trailing, traders said.

The 6.45% senior notes due 2024 dived 7 points to close at 43 bid.

The Columbus, Ohio-based real estate investment trust’s issues remain active this week after issuing Q2 reports.

The company showed a 1 cent per share profit and revenues of $98.76 million.

Also, $1.3 billion in credit facilities were modified after receiving lender consents to modify, including financial covenant waivers.

Chattanooga, Tenn.-based mall owner CBL’s paper was under water.

The 5¼% senior notes due 2023 fell 1¼ points to close at 22¾ bid. The 4.6% senior notes due 2024 shaved off ¼ point to close at 22 bid.

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