Exela notes soften; CBL stronger; Transocean up; Talen declines; Peabody treads higher

By Cristal Cody

Tupelo, Miss., July 6 – Exela Technologies, Inc.’s bonds gave back some gains on Tuesday after the company’s paper ended Friday about 25 points better on the week.

Debt issuer Exela Intermediate LLC’s 10% senior secured first-lien notes due 2023 (Caa3/CCC-) softened 7/8 point to 68 1/8 bid on $4.95 million of trading action on Tuesday, a source said.

The notes edged up ¼ point during the Independence Day holiday-shortened trading session on Friday after adding about 4¾ points on Thursday and more than 20 points on Wednesday.

The issue was quoted at 31 bid as the year opened.

The Irving, Tex.-based software and services company announced on Wednesday it completed a $100 million at-the-market equity program and that it has entered into an additional $150 million at-the-market equity program.

CBL bonds improve

Elsewhere, bankrupt real estate investment trust CBL & Associates LP’s bonds saw heavy trading ahead of the Fourth of July weekend and continued to climb higher on Tuesday.

CBL’s 5.95% notes due 2026 were up ¼ point at 58¼ bid during the session after gaining 1 point in the short market session on Friday, a source said.

The bonds have improved from 40 bid at the start of the year.

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 new bankruptcy restructuring plan.

The company received an extension through July 29 to solicit votes.

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.

On June 30, CBL reported in a court filing the company had a $56,000 net income on $32.6 million of revenue for the May period, up from a $2.6 million loss on $29.86 million of revenue for the April period.

Transocean stronger

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

The iShares iBoxx High Yield Corporate Bond ETF fell 5 cents to close at $88.01.

The S&P U.S. High Yield Corporate Distressed Bond index closed Friday down 0.04% and with month-to-date total returns of 0.15% and year-to-date total returns of 28.06%.

Oil prices declined over the day.

North Sea Brent crude oil futures for September deliveries settled down $1.64 at $74.53 a barrel.

West Texas Intermediate crude oil benchmark futures for August deliveries dropped $1.79 to settle at $73.37 a barrel, while September deliveries settled $1.78 lower at $72.58 a barrel.

In distressed energy issues, Vernier, Switzerland-based offshore driller Transocean Inc.’s 6.8% notes due 2038 (C/CCC-/) jumped over 1½ points to 69½ bid on more than $19.8 million of secondary volume on Tuesday, a source said.

Talen trades down

Elsewhere in the energy space, Talen Energy Supply LLC’s bonds traded down in heavy secondary volume during the session, a source said.

The Woodlands, Tex., and Allentown, Pa.-based power company’s paper headed out Friday down about ¾ point.

Talen’s 6½% senior notes due 2025 (B3/CCC+/B) declined 2 points to 63½ bid on $4 million of secondary supply Tuesday.

The issue has weakened from the 84½ bid range at the end of May and the 82 bid area at the start of the year.

Talen’s 10½% notes due 2026 (B3/CCC+/B) also traded down 2½ points to 3 points, going out at 69 bid on $1.3 million of volume.

The bonds traded at 91 bid at the end of May and the 89 bid area in early January.

Talen’s outlook was dropped to negative from stable on June 16 by Moody’s Investors Service.

Peabody Energy rallies

In other distressed energy issues, Peabody Energy Corp.’s 6 3/8% notes due 2025 (Caa1/CCC) added about 1¼ points on Tuesday to head out at 76 bid in strong trading activity, a market source said.

The notes are 2 points better since the end of June.

The St. Louis-based coal producer’s notes are more than 18 points higher since the end of May.

TPC Group higher

TPC Group Inc.’s 10½% notes due 2024 (Caa2) traded nearly 1 point better at 96 bid on $1.5 million of trading activity on Tuesday, according to a market source.

The Houston-based chemical manufacturer’s notes have improved from 83 bid as the year opened.

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