Envision, Team Health, ASP AMC decline; NGL, Transocean, Talen up; Diamond Sports off

By Cristal Cody

Tupelo, Miss., Oct. 15 – Distressed bonds in the health care space remained under pressure on Friday after trending lower over much of the week’s post-holiday secondary trading.

Nashville-based Envision Healthcare Corp.’s 8¾% senior notes due 2026 (Ca/CC) fell over 1 point to the 71 bid area, a source said. The issue saw over $3 million of trading volume.

Team Health Holdings, Inc.’s 6 3/8% senior notes due 2025 (Caa3/CCC) traded 1 3/8 points weaker.

ASP AMC Intermediate Holdings Inc.’s paper ended 1¼ points lower on the day and 4¼ points down on the week.

The session stayed fairly active, according to market sources.

“It was not that quiet,” one source said. “It’s been more new issue driven. But everything has been trading up.”

Focus remained on the heavy round of strong earnings releases that has helped keep equities buoyed over the last two sessions.

Market tone was mixed in the junk space.

The iShares iBoxx High Yield Corporate Bond ETF ended weaker by 15 cents at $87.22.

Energy bonds were mostly stronger with Brent and WTI oil prices nearly $1 higher on Friday.

West Texas Intermediate crude oil benchmark futures for November deliveries rose 97 cents to settle at $82.28 a barrel.

NGL Energy Partners LP’s 7½% senior notes due 2026 (Caa1/CCC+) were quoted up more than 3 points.

Transocean Inc.’s 8% debentures due 2027 (Ca/CCC+) rose 2¼ points.

Talen Energy Supply LLC’s 6% senior notes due 2036 (B3/CCC/B-) jumped 4 points during the session.

Meanwhile, Diamond Sports Group LLC’s secured and unsecured notes fell another ½ point to 1¾ points in Friday’s session.

The company’s bonds finished the week down 3½ points to 5 points following parent Sinclair Broadcast Group Inc.’s report last week of a third round of funding discussions.

ASP AMC softens

New York-based ambulance service provider ASP AMC Intermediate Holdings’ paper ended 1¼ points lower on Friday, sources said.

Subsidiary ASP AMC Merger Sub Inc.’s 8% senior notes due 2025 (Caa3/CCC) softened to 86¼ bid on $4 million of secondary volume.

The notes dropped 4¼ points over the week.

Team Health down

Team Health Holdings’ 6 3/8% senior notes due 2025 (Caa3/CCC) traded 1 3/8 points weaker on Friday at 87 bid on $6 million of trading supply, a source said.

The notes are down 3 points on the week.

The issue ended the prior week down 7½ points on $21 million of secondary supply.

The Knoxville, Tenn.-based medical staffing firm is owned by Blackstone Group LP.

Energy bonds gain

In other secondary action, Tulsa, Okla.-based diversified midstream services provider NGL’s 7½% senior notes due 2026 (Caa1/CCC+) were quoted up more than 3 points and trading better than 91 bid on Friday, a source said.

Transocean’s 8% debentures due 2027 (Ca/CCC+) rose 2¼ points on over $5 million of volume Friday.

The Vernier, Switzerland-based offshore driller’s 8% bonds were quoted at 81 bid.

Talen Energy Supply’s 6% senior notes due 2036 (B3/CCC/B-) jumped 4 points during the session to 44½ bid.

The Woodlands, Tex., and Allentown, Pa.-based power company’s notes have come back from trading at 29¼ bid at the end of August.

Diamond Sports lower

Diamond Sports’ 5 3/8% senior secured notes due 2026 (Caa1/CCC) ended ½ point lower at 59½ bid on Friday after dropping 1 point in the prior session, a source said.

The notes are down 3½ points from a week ago.

Diamond Sports’ 6 5/8% senior notes due 2027 (Ca/CC) shed 1¾ points to finish the day at 35 bid.

The notes were down Thursday by 1½ points.

The notes are ending the week 5 points off from last week’s finish.

Diamond Sports’ parent, Sinclair Broadcast, reported on Oct. 7 that it made a Sept. 28 proposal to secure new funding for the Chesapeake, Va.-based sports broadcast group.

The proposal follows Sinclair’s report in June that it made two proposals dated March 22 and April 29 to lenders and noteholders of Diamond Sports.

Distressed credits declining

In other market news, Moody’s Investors Service said in a report released Friday that distressed credits are declining, but still above the pre-pandemic levels.

U.S. speculative-grade companies have $1.45 trillion of debt maturing from 2022 through 2026, surpassing the previous high of $1.41 trillion for 2021-2025 maturities, according to the report.

“The increase is driven by leveraged-loan and revolver maturities that rose 10% to $996 billion for the 2022-2026 period, while five-year high-yield bond maturities fell 11% to $451 billion, versus last year when both loan and high-yield bond maturities increased,” Moody’s said.

Distressed returns up

Distressed index returns improved late in the week, according to the latest data available.

The S&P U.S. High Yield Corporate Distressed Bond index’s one-day total returns rose to 0.12% on Thursday, compared to minus 0.1% on Wednesday and 0.08% on Tuesday.

Month-to-date total return declines narrowed to minus 0.08% from 0.2% the previous session and minus 0.1% on Tuesday.

Year-to-date total returns improved to 30.12% on Thursday versus 29.97% on Wednesday and 30.1% at the start of the short holiday week.

© 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.