Washington Prime flat; Hertz mixed; Valaris softens; Moss Creek up; Diamond Sports down

By Cristal Cody

Tupelo, Miss., April 12 – Washington Prime Group, LP’s 6.45% notes due 2024 (C/D/C) saw heavy trading over Monday’s session after the company announced a second forbearance period.

The notes were quoted in the 59 to 61 bid range after trading Friday in the 60 bid area, a source said.

The 6.45% notes were seen in the 73½ bid area in mid-February and started the year in the 61 bid range.

Washington Prime Group, Inc. reported in an 8-K filing with the Securities and Exchange Commission on Monday that its partnership lenders and noteholders have agreed to extend a forbearance period to April 28.

The company disclosed in February that the operating partnership withheld a $23.2 million interest payment on the notes that was due Feb. 15.

Washington Prime entered a forbearance period that was first scheduled to end on March 31 and was extended through April 14.

The Columbus, Ohio-based shopping center real estate investment trust said it is continuing to engage in negotiations and discussions with the noteholders and lenders to restructure its capital structure.

Washington Prime reported in March that it was in discussions on a potential deleveraging or restructuring of the notes, which may need to be implemented by filing for Chapter 11 bankruptcy.

Hertz flat to softer

Hertz Corp.’s bonds were mostly flat to softer over the day as the company moves closer toward a June exit from Chapter 11 bankruptcy and ahead of a Friday court hearing.

Hertz’s 7% notes due 2028 traded Monday down about 1 point at 74 bid, a source said.

The bonds traded at the start of 2021 at a 50 bid range.

Hertz announced on April 3 that it selected a new proposal with greater creditor support from Centerbridge Partners, LP, Warburg Pincus LLC and Dundon Capital Partners, LLC to fund its exit from Chapter 11 bankruptcy.

The Estero, Fla.-based car rental operator filed an amended Chapter 11 plan of reorganization and related disclosure statement in the U.S. Bankruptcy Court for the District of Delaware.

On March 2, Hertz had filed a joint Chapter 11 bankruptcy plan of reorganization with a $4.2 billion buyout offer from Knighthead Capital Management, LLC and Certares Opportunities LLC.

Under both proposals, Hertz said it would eliminate approximately $5 billion of debt, have over $2 billion of global liquidity and completely eliminate all corporate debt on its European business.

A hearing on the offer is scheduled for Friday.

Hertz filed for Chapter 11 bankruptcy on May 22, 2020.

Valaris active

Bankrupt offshore drilling contractor Valaris plc’s bonds were active in secondary trading on Monday and ahead of the weekend, a market source said.

The company’s 4½% notes due 2024 were quoted down about ½ point from the prior week at 6¾ bid.

Valaris announced on March 3 that it received approval for its Chapter 11 plan of reorganization in the U.S. Bankruptcy Court for the Southern District of Texas Houston Division.

In January, Valaris had filed a third amended joint plan of reorganization after filing for bankruptcy on Aug. 19, 2020.

The company will eliminate $7.1 billion of existing debt under the plan and receive a $520 million capital injection through the issuance of a $550 million secured note due 2028.

Overall market tone was mostly soft as the week kicked off.

The iShares iBoxx High Yield Corporate Bond ETF fell 9 cents to $87.11.

Oil futures gained after softening late last week.

North Sea Brent crude oil futures for June deliveries rose 33 cents to settle at $63.28 a barrel.

West Texas intermediate crude oil futures for May deliveries settled up 38 cents at $59.70 a barrel, while June deliveries gained 40 cents to settle at $59.75 a barrel.

Oil and gas exploration company Moss Creek Resources Holdings Inc.’s 7½% senior notes due 2026 (Caa2/B-) traded up ½ point from Friday to 84 bid, a source said.

Petroleum refiner PBF Holding Co. LLC’s 6% senior notes due 2028 (B3/B+/B+) were heading out Monday afternoon flat at 76 bid.

Diamond Sports declines

Diamond Sports Group LLC’s bonds remained soft on Monday after declining Friday, a market source said.

Diamond Sports’ 6 5/8% senior notes due 2027 (B3/CCC-) traded 2¼ points lower at 47 bid after falling 1¼ points on Friday.

The issue started the year in the 60 bid range.

The Chesapeake, Va.-based sports broadcast group’s bonds have declined since parent company Sinclair Broadcast Group, Inc. reported in February soft guidance for the subsidiary and an interest in liability management initiatives that could include a debt exchange or redemption.

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