Intelsat lower on restructuring; Washington Prime falls on missed payment; Transocean up

By Cristal Cody

Tupelo, Miss., Feb. 16 – Intelsat Jackson Holdings SA’s bonds softened in heavy trading on Tuesday in the first session after the company announced it reached a restructuring plan that would cut its debt by more than half.

The company’s 8½% senior notes due 2024 fell to 63¾ bid from where the notes traded Friday at 66½ to 68 bid, a source said. The issue traded at the start of February at 73 bid.

Intelsat Jackson’s 5½% senior notes due 2023 were seen early Tuesday at 64½ bid before softening to 62¼ bid by late afternoon.

The issue went out Friday at 65¾ bid, down from 70 bid on Thursday and 70¼ bid on Wednesday.

Also on Tuesday, Intelsat Jackson’s 9¾% senior notes due 2025 dropped 5½ points from Friday to trade at 63½ bid as the session closed.

Parent company Intelsat SA filed for Chapter 11 bankruptcy in May 2020 in the U.S. Bankruptcy Court for the Eastern District of Virginia, Richmond Division.

The satellite operator said in the statement on Friday that it had reached an agreement with key creditors to reduce the company’s debt to $7 billion from nearly $15 billion.

The plan has the support of holders of $3.8 billion of the company’s funded debt, according to the release.

Intelsat said it was filing a proposed plan of reorganization and requesting a hearing on March 17 to seek court approval and establish procedures to solicit votes on the plan.

Washington Prime declines

In other distressed secondary trading on Tuesday, Washington Prime Group, LP’s 6.45% notes due 2024 (C/C/) fell 9¼ points to 63¾ bid on trading volume of more than $21 million, a source said.

The Columbus, Ohio-based shopping center real estate investment trust’s stock sank 38% during the session to $7.49 a share.

Washington Prime Group, Inc. announced in an 8-K filing with the Securities and Exchange Commission on Tuesday that the operating partnership “elected to withhold an interest payment of $23.2 million” with respect to the senior notes due 2024.

The operating partnership has 30 days to resolve the payment that was due on Sunday or the missed payment will constitute a default.

Washington Prime Group said in the filing that it has hired legal counsel and an investment banker to help in discussions with its lenders.

Transocean stronger

Market tone was mixed after the long Presidents Day holiday weekend.

The iShares iBoxx High Yield Corporate Bond ETF fell 14 cents, or 0.16%, to $87.64 on Tuesday.

Meanwhile, the S&P U.S. High Yield Corporate Distressed Bond index has quarterly and year-to-date total returns of 11% after closing Friday 0.07% better. Month to date, the index has positive returns of 2.37%.

Oil futures continued to gain on Tuesday.

North Sea Brent crude oil futures for April deliveries added 92 cents to settle at $63.35 a barrel.

West Texas intermediate crude oil for March deliveries rose 58 cents, climbing past $60 to settle at $60.05 a barrel.

In the energy space, offshore driller Transocean Inc.’s paper was mostly higher on the day, a source said.

The company’s 7½% senior notes due 2026 (Ca) improved to 60½ bid over Tuesday’s session in heavy supply.

The notes were last seen trading heavily on Wednesday at 58½ bid and in the same session a week ago at 57 bid.

Transocean’s 6.8% notes due 2038 (C/CCC-/) were quoted up more than 2½ points over the day at 44¾ bid.

Also, Transocean’s 11½% guaranteed senior notes due 2027 (Caa3/CCC) traded more than 1¾ points better at 81¼ bid on Tuesday.

In other energy bonds active during the session, Talen Energy Supply LLC’s 6½% senior notes due 2025 (B3/CCC+/B) headed out 3¾ points stronger at 88¼ bid, a source said.

AMC improves

Elsewhere, movie theater owner AMC Entertainment Holdings, Inc.’s distressed and heavily traded bonds saw inroads on Tuesday, a source said.

The company’s 12% second-lien senior secured notes due 2026 (Ca/C) climbed 2 1/8 points to 64½ bid.

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