AMC bonds continue climb higher; distressed energy issues mixed; Hertz, Mallinckrodt improve

By Cristal Cody

Tupelo, Miss., Feb. 1 – AMC Entertainment Holdings, Inc.’s bonds remained heavily traded in the distressed secondary market on Monday.

The company’s 12% second-lien senior secured notes due 2026 (Ca/C) climbed 1¼ points on the day to 74¼ bid, a source said.

The notes traded at the start of the year at 27 bid.

AMC’s 10½% first-lien senior secured notes due 2025 (Caa2/CCC) were last seen softer at 101¾ bid on Monday, a source said.

The notes went out on Friday at 102 bid, up from where the issue traded at the start of the new year at 73½ bid.

AMC’s bonds have rallied since the company last week announced additional funding raised, including $917 million of new equity and debt capital and another $305 million through its at-the-market equity program.

The company’s stock was volatile in the prior week, climbing 301.21% in one session and closing up 53.65% at $13.26 on Friday. On Monday, the stock edged up 4 cents, or 0.3%, to $13.30.

Energy bonds improve

Market tone was stronger with major stock indices higher on Monday, including the Nasdaq that closed up 2.55%.

The iShares iBoxx High Yield Corporate Bond ETF rose 29 cents, or 0.29%, to $86.93 on Monday.

The S&P U.S. High Yield Corporate Distressed Bond index ended Friday flat on the day but with month- and year-to-date total returns of 8.43%.

Oil futures were mixed as February kicked off.

North Sea Brent crude oil futures for March deliveries were unchanged for a second day at $55.53 a barrel on Monday.

West Texas intermediate crude oil for March deliveries climbed $1.35 to settle at $53.55 a barrel.

Distressed energy bonds were mixed on Monday after softening last week as the Biden administration paused new oil and natural gas leases on public lands and offshore waters.

Offshore driller Transocean Inc.’s 7½% senior notes due 2026 (Ca/CCC-) were active Monday in strong volume, trading at 52½ bid, a source said. The notes were last seen in the prior week at 51¾ bid.

Plains All American Pipeline, LP’s 6 1/8% perpetual fixed-to-floating-rate cumulative redeemable preferred securities (Ba3/BB) fell more than 1½ points to 81¾ bid on Monday.

Natural gas liquids company W&T Offshore, Inc.’s 9¾% senior secured second-lien notes due 2023 (Caa3/B) declined more than 1 point to 78½ bid during the session.

Bankrupt Chesapeake Energy Corp.’s 4 7/8% senior notes due 2022 saw heavy trading over the day after strong secondary volume on Friday, a source said.

The notes traded over the morning at 5½ bid before improving to 6¼ bid late afternoon. The notes traded as high as 7 bid on Friday.

The company’s 5¾% senior notes due 2023 softened to 5½ bid on Monday from 5 7/8 bid ahead of the weekend.

Chesapeake Energy’s plan to exit Chapter 11 bankruptcy was approved in January.

Hertz notes rise

In other distressed trading on Monday, pharmaceuticals maker Mallinckrodt plc’s 5 5/8% notes due 2023 added 1¾ points to 42¾ bid, a source said.

The company (D) filed for Chapter 11 bankruptcy in October.

Meanwhile, bankrupt car rental company Hertz Corp.’s 5½% notes due 2024 improved about ¾ point to 64 bid in strong trading supply over the day, according to a market source.

Hertz filed for Chapter 11 bankruptcy in May.

In January, the company received bankruptcy court approval to dispose of at least 121,510 lease vehicles in a master lease agreement in exchange for paying noteholders $756 million in nine equal payments of $84 million.

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