CBL notes gain on amended agreement; Talen, Nine Energy down; Mallinckrodt better

By Cristal Cody

Tupelo, Miss., May 3 – Bankrupt real estate investment trust CBL & Associates LP’s bonds traded higher on Monday following the company’s court approval of an amended restructuring support agreement.

CBL’s 5¼% notes due 2023 were seen in the 58 bid range over Monday’s session, about 1½ points higher from Friday, a source said.

CBL’s 5.95% notes due 2026 also rose about 1 point to 58 bid during the session.

The company received approval to enter into an amended restructuring support agreement, according to a filing on Friday with the U.S. Bankruptcy Court for the Southern District of Texas, Houston Division.

The Chattanooga, Tenn.-based owner and developer of malls and shopping centers reported on March 22 that it expects to eliminate more than $1.6 billion of debt under a restructuring plan.

CBL and 176 affiliated companies filed for Chapter 11 bankruptcy on Nov. 1 and Nov. 2 in the U.S. Bankruptcy Court for the Southern District of Texas, Houston Division.

The company is expected to file an amended Chapter 11 plan.

Talen, Nine Energy soften

Oil prices were mixed as the week kicked off.

North Sea Brent crude oil futures for June deliveries settled unchanged a second day on Monday at $68.56 a barrel after improving $1.29 on Thursday.

West Texas intermediate crude oil futures for June deliveries settled 91 cents higher at $64.49 a barrel after declining $1.43 on Friday.

The iShares iBoxx High Yield Corporate Bond ETF improved 7 cents to $87.22 on Monday.

The S&P U.S. High Yield Corporate Distressed Bond index finished Friday down 0.06% and with a 3.98% month-to-date total return for April. The index has a 21.52% year-to-date total return as of Friday.

In distressed energy issues trading Monday, The Woodlands, Tex., and Allentown, Pa.-based power company Talen Energy Supply LLC’s 6½% senior notes due 2025 (B3/CCC+/B) fell 1½ points to 84¾ bid in heavy supply, a source said.

Houston-based oilfield services company Nine Energy Service, Inc.’s 8¾% notes due 2023 (Caa2/D) dropped about 1¼ points to the 40¼ bid area in light volume after seeing heavy trading on Friday, a source said.

The notes have improved from trading in March at 30 bid.

Both Talen and Nine Energy, along with other energy suppliers, have reported impacts from the Texas winter weather storm in February.

Endo higher

In the distressed pharmaceuticals sector, Endo Finance LLC’s 6% senior notes due 2028 (Caa2/CCC+) rose about ½ point to the 77 bid area on Monday after climbing more than 8 points in the prior week in heavy trading action, a source said.

The notes are nearing where the issue traded at the start of the year at 84 bid.

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

Mallinckrodt improves

Bankrupt pharmaceuticals maker Mallinckrodt plc’s bonds were mostly better on Monday, a market source said.

The company’s 5½% notes due 2025 rose 1 point to 67 bid.

Mallinckrodt filed its Chapter 11 plan of reorganization and disclosure statement in the U.S. Bankruptcy Court for the District of Delaware on April 20.

A hearing on the plan is scheduled for May 26.

The company 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.

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

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