Hertz jumps on new Chapter 11 plan; Frontier Communications, Endo up; Mallinckrodt flat

By Cristal Cody

Tupelo, Miss., April 21 – Hertz Corp.’s bonds climbed higher in secondary trading after the company filed a fourth modified Chapter 11 bankruptcy plan on Wednesday.

The 5½% notes due 2024 rose to 104¾ bid in strong supply over the day, up 1¼ points from Tuesday and nearly 6 points higher from the same session a week ago, a source said.

The Estero, Fla.-based car rental operator’s 7% notes due 2028 hit 99 bid in thin secondary volume.

The issue traded in the same session a week ago at 80 bid.

Hertz filed the fourth modified second amended Chapter 11 plan of reorganization filing and disclosure statement on Wednesday in the U.S. Bankruptcy Court for the District of Delaware.

The plan implies a total enterprise value of approximately $5.5 billion.

Hertz previously filed an amended Chapter 11 bankruptcy plan and disclosure statement on Friday.

The amended plan sponsors included Warburg Pincus LLC, Centerbridge Partners LP and Dundon Capital Partners LLC, as well as initial consenting holders of the company’s 6¼% senior notes due 2022, 5½% senior notes due 2024, 7 1/8% senior notes due 2026, 6% senior notes due 2028 and obligations under the company’s credit agreement dated Dec. 13, 2019.

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

Frontier heads higher

Frontier Communications Corp.’s bonds remained heavily traded Wednesday after being among the most actively traded bonds in the prior two sessions, a source said.

Frontier’s 11% senior notes due 2025 were seen up at 71 5/8 bid by late afternoon after heading out Tuesday at 71¼ bid.

The 11% notes are trading more than 2½ points better from the same day a week ago.

The Norwalk, Conn.-based telecommunications company reported Tuesday a $15.29 million earnings loss on $560.16 million of revenue for March.

Frontier filed for Chapter 11 on April 14, 2020 in the U.S. Bankruptcy Court for the Southern District of New York.

The company reported last week that it expects to emerge from Chapter 11 bankruptcy soon.

Under the restructuring announced in April with unsecured bondholders representing more than 75% of the company’s approximate $11 billion of outstanding unsecured bonds, Frontier expects to eliminate more than $10 billion of debt.

Frontier said the restructuring agreement leaves unimpaired all general unsecured creditors and holders of its secured and subsidiary debt.

Endo improves

Looking at the distressed pharmaceuticals sector, Endo Finance LLC’s 6% senior notes due 2028 (Caa2/CCC+) declined early in Wednesday’s session before heading out better on the day at 68 5/8 bid, a source said.

The notes were seen down about ¾ point by early afternoon after dropping nearly 2 points in the prior session to 68¼ bid.

Endo’s 6% notes have softened from 74 bid a week ago and from 84 bid at the start of the year.

Parent Dublin-based pharmaceuticals maker Endo International plc will report its first-quarter earnings results on May 6.

Mallinckrodt steady

Bankrupt pharmaceuticals maker Mallinckrodt plc’s bonds were steady in thin trading on Wednesday following the company’s Chapter 11 bankruptcy plan filing in the previous day, a source said.

Mallinckrodt’s 4¾% notes due 2023 were mostly flat at 20 bid after declining 3 points on Tuesday.

The issue has softened from the 24 bid range in the same session a week ago but remains stronger than the 7 bid area at the start of 2021.

Mallinckrodt filed a Chapter 11 plan of reorganization and disclosure statement with the U.S. Bankruptcy Court for the District of Delaware on Tuesday.

Mallinckrodt announced in March that it reached an agreement with a group of first-lien term lenders holding about $1.3 billion of its outstanding first-lien term loans to support its restructuring support agreement.

A hearing on the plan is scheduled for May 26.

The company, which has principal offices in Dublin and St. Louis, filed for Chapter 11 bankruptcy on Oct. 12, 2020.

NGL mostly soft

In the energy space, NGL Energy Partners LP’s 7½% senior notes due 2026 (Caa1/CCC+) fell more than 2½ points to 86 bid by late afternoon, a market source said. The notes traded on Friday at 89¼ bid.

The Tulsa, Okla.-based diversified midstream company’s 6 1/8% senior notes due 2025 (Caa1/CCC+) traded Wednesday in the 87½ bid area. The notes are mostly unchanged from Tuesday but down about ½ point week to date.

Oil prices were weaker a second day.

North Sea Brent crude oil futures for June deliveries settled $1.25 lower at $65.32 a barrel.

West Texas intermediate crude oil futures declined $1.32 to settle the day at $61.35 a barrel.

Offshore drilling contractor Shelf Drilling Holdings Ltd.’s 8¼% senior notes due 2025 (Caa3/CCC+) were quoted flat at 73¾ bid in light secondary trading Wednesday. The notes are up 1¼ points from the same day a week ago.

Overall market tone was mostly better.

The iShares iBoxx High Yield Corporate Bond ETF closed 27 cents higher at $87.30.

© 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.