Hertz notes rebound; Nabors unchanged; Transocean, NGL quiet; Mallinckrodt, Endo higher

By Cristal Cody

Tupelo, Miss., May 17 – Hertz Corp.’s bonds continued to improve on Monday after heading into the weekend up 1 to 1½ points on a new Chapter 11 bankruptcy plan of reorganization with sponsors Knighthead Capital Management LLC, Certares Opportunities LLC and Apollo Capital Management, LP.

Hertz’s 5½ notes due 2024 rose ½ point to 104¼ bid following a 1-point bump on Friday, a source said.

The notes have climbed from 53½ bid at the start of the year.

On Monday, Hertz Global Holdings, Inc. received court approval of the new sponsors to provide the equity capital required to finance its revised plan of reorganization and bankruptcy exit.

The Estero, Fla.-based car rental operator said it is working toward a Chapter 11 exit by June 30.

A court hearing to confirm Hertz's new plan of reorganization is scheduled for June 10.

Hertz filed for Chapter 11 bankruptcy on May 22, 2020 in the U.S. Bankruptcy Court for the District of Delaware.

Nabors bonds flat

Crude oil prices settled higher on Monday.

North Sea Brent crude oil futures for July deliveries rose 75 cents to settle at $69.46 a barrel.

West Texas intermediate crude oil benchmark futures for June deliveries settled 90 cents higher at $66.27 a barrel.

Bermuda- and Houston-based oil and gas drilling contractor Nabors Industries Inc.’s 5¾% senior notes due 2025 (Caa2/CCC-) traded flat at 83 bid in heavy secondary volume on Monday, a market source said.

Secondary action was light in distressed energy bonds from companies including Transocean Inc. and NGL Energy Partners LP on Monday, a source said.

Tulsa, Okla.-based diversified midstream services provider NGL Energy’s 7½% senior notes due 2026 (Caa1/CCC+) were last seen on Friday trading in the 89½ bid area.

Overall market tone was soft.

The iShares iBoxx High Yield Corporate Bond ETF fell 16 cents to close at $87.05.

The S&P U.S. High Yield Corporate Distressed Bond index ended Friday up 0.05%. The index has month-to-date total returns of 2.02% and year-to-date total returns of 23.98%.

Mallinckrodt improves

In other distressed secondary trading, bankrupt pharmaceuticals maker Mallinckrodt plc’s 5 5/8% notes due 2023 rose 1/8 point to 64 bid on Monday, a market source said.

The notes are up 2 points from the same session a week ago.

Mallinckrodt has an upcoming hearing on the company’s Chapter 11 bankruptcy plan of reorganization and disclosure statement scheduled for May 26.

The company filed the plan and statement on April 20 in the U.S. Bankruptcy Court for the District of Delaware.

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

Endo edges up

Endo Finance LLC’s 6% senior notes due 2028 (Caa2/CCC+) traded about ¼ point better at the 74 bid area over the day, a source said.

The notes have declined about 2 points from the same day a week ago.

Parent Dublin-based pharmaceuticals maker Endo International plc reported weaker first-quarter earnings and revenue earlier in May.

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