Hertz mostly softens; CBL notes higher; Peabody rallies; Consol dips; AMC trades higher

By Cristal Cody

Tupelo, Miss., June 2 – Hertz Corp.’s paper headed out mixed on Wednesday following objections to the company’s Chapter 11 bankruptcy plan from a second-lien note trustee and second-lien noteholders.

“Hertz bonds were a little bit softer today,” a source said.

Hertz’s 5½% notes due 2024 fell 1¾ points to 103¾ bid on more than $2 million of issues traded.

The company’s 6% notes due 2028 were flat at 106¾ bid on $2 million of trading volume over the session.

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

In May, Hertz Global Holdings, Inc. received court approval for new sponsors Knighthead Capital Management LLC, Certares Opportunities LLC and Apollo Capital Management, LP 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.

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

CBL notes improve

Bankrupt real estate investment trust CBL & Associates LP’s bonds remained better on Wednesday following the company’s reported April net loss, a source said.

CBL’s 5¼% notes due 2023 rose 1 point to 55 bid.

The notes are up from the 53½ bid area seen in the same session a week ago.

CBL reported to the U.S. Bankruptcy Court for the Southern District of Texas, Houston Division on Tuesday a $2.62 million net loss for its April period.

The Chattanooga, Tenn.-based owner and developer of malls and shopping centers received approval to enter into an amended restructuring support agreement in April.

CBL and 176 affiliated companies filed for Chapter 11 bankruptcy on Nov. 1, 2020 and Nov. 2, 2020.

Peabody bonds stronger

St. Louis-based coal producer Peabody Energy Corp.’s 6 3/8% notes due 2025 (Caa1/CCC) rose 1 3/8 points on Wednesday to head out at 60 bid in strong trading volume, a source said.

The notes have rallied from trading at 42 bid at the end of April.

“The equity was up yesterday 10%,” the market source said.

Peabody’s stock closed up another 1.42% on Wednesday.

In other distressed coal issues active on Wednesday, Canonsburg, Pa.-based coal producer Consol Energy Inc.’s 11% second-lien notes due 2025 (Caa1/CCC) traded less than ¼ point weaker at 98 bid in light volume.

“Over a period of [the past] month, the bonds have gone up 2 points,” a source said. “It’s a very small issue – only $153 million outstanding – so not much traded.”

Transocean, Nabors gain

Overall market tone remained strong on Wednesday.

The iShares iBoxx High Yield Corporate Bond ETF improved 11 cents at $87.26.

The S&P U.S. High Yield Corporate Distressed Bond index kicked off June up 0.33% on Tuesday. The index has quarter-to-date total returns of 6.89% and year-to-date total returns of 24.93%.

Oil prices climbed higher.

North Sea Brent crude oil futures for July deliveries settled up $1.10 at $71.35 a barrel.

West Texas intermediate crude oil benchmark futures for July deliveries rose $1.11 to settle the day at $68.83 a barrel.

Vernier, Switzerland-based offshore driller Transocean Inc.’s 7¼% senior notes due 2025 (Ca/CCC) gained nearly 2 points in thin trading to 82 bid, a source said.

Bermuda- and Houston-based oil and gas drilling contractor Nabors Industries Ltd.’s 7½% senior notes due 2028 (Caa1/CCC-/B) were nearly 1½ points higher at 90 bid on more than $2.4 million of trading supply.

AMC bonds up

Elsewhere, AMC Entertainment Holdings, Inc.’s bonds improved in heavy trading action on Wednesday after softening in the prior session, a source said.

AMC’s 12% second-lien senior secured notes due 2026 (Ca/C) rose ½ point to 97½ bid on nearly $25 million of trading volume.

The notes softened Tuesday about 1¾ points after heading out Friday up 1 point on the day and 7 points better on the week.

AMC’s 5¾% senior subordinated notes due 2025 (Ca/C) also improved ½ point to 80 bid during the session on more than $16.5 million of secondary volume.

The Leawood, Kan.-based movie theater owner raised approximately $428 million in a registered offering of 43 million shares of class A common stock in May.

In January, AMC raised or signed commitment letters to receive $917 million of new equity and debt capital and issued $100 million of guaranteed first-lien secured notes due 2026.

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