Talen slides; PBF lower; TPC notes up; Cornerstone soft; Diamond Sports, Envision down

By Cristal Cody

Tupelo, Miss., Nov. 22 – Distressed energy bonds slid in secondary trading on Monday as oil prices improved.

Talen Energy Supply LLC’s paper sank about 5½ points to 9 points.

PBF Holding Co. LLC’s bonds were about 2½ points to 3 points weaker.

January oil prices were higher.

West Texas Intermediate crude oil benchmark futures for January deliveries settled up 81 cents at $76.75 a barrel.

The junk market was mixed on Monday as measured market volatility climbed over 7%.

The iShares iBoxx High Yield Corporate Bond ETF fell 33 cents to $86.23.

TPC Group Inc.’s 10½% senior secured notes due 2024 (Caa2/CCC-/B-) climbed 4 points in early trading before closing the day 1½ points higher.

In other distressed chemical issues, Cornerstone Chemical Co.’s 6¾% senior secured notes due 2024 (B3/CCC+) are trading about ¼ point lower so far in November.

Elsewhere, Diamond Sports Group LLC’s notes softened about ½ point to 1¼ points after the paper declined over 8 points in the prior week.

Envision Healthcare Corp.’s 8¾% senior notes due 2026 (Ca/CC) also fell another 3¼ points on Monday following a drop of 5¾ points on Friday.

Talen declines

Talen Energy’s notes headed out Monday down about 5½ points to 9 points after trading Friday off 1½ points to 4½ points, a source said.

The company’s 6½% senior notes due 2025 (Caa1/CCC/B-) slid 5½ points to 55½ bid with $1 million of issues traded.

Talen’s 10½% senior notes due 2026 (Caa1/CCC/B-) were quoted at 56 bid, down 5½ points on the day, on $6 million of secondary supply.

The notes fell 4½ points on Friday.

The Woodlands, Tex., and Allentown, Pa.-based power company announced Friday that it will hold its third-quarter conference call on Dec. 2.

PBF off

PBF Holding’s 7¼% notes due 2025 (Caa1/B/B-) lost 2½ points over the day to hit 75 bid in light trading, a source said.

The Parsippany, N.J.-based petroleum refiner’s 6% senior notes due 2028 (Caa1/B/B-) were down 3 points at 68 bid on heavier volume of over $8.5 million during the session.

TPC up, Cornerstone soft

TPC Group’s 10½% senior secured notes due 2024 (Caa2/CCC-/B-) traded as high as 73 bid out of the gate before closing up 1½ points better on the day at 70½ bid, a source said.

The issue saw $3 million of paper changing hands on Monday.

The notes went out on Friday up 1¼ points to 1½ points.

The Houston-based chemical manufacturer’s issue dropped over 10 points in the first four sessions last week after sliding from the 91 bid range at the start of the month.

In other distressed chemical paper, Cornerstone Chemical’s 6¾% senior secured notes due 2024 (B3/CCC+) are trading about ¼ point lower in November, a source said.

The Metairie, La.-based chemicals manufacturer’s bonds were last seen trading on Friday at 89¾ bid.

Diamond Sports slips

Diamond Sports’ notes softened about ½ point to 1¼ points on Monday after the paper slid over 8 points in the prior week, a source said.

The company’s 5 3/8% senior secured notes due 2026 (Caa1/CCC) fell 1¼ points to 47¾ bid.

The Chesapeake, Va.-based sports broadcast group’s 6 5/8% senior notes due 2027 (Ca/CC) headed out down ½ point at 23½ bid.

Parent Sinclair Broadcast Group Inc. reported it has been in negotiations with lenders and noteholders to restructure Diamond Sports’ balance sheet this year but so far has not reached a deal.

Sinclair announced earlier this month that it had taken on a portion of Diamond Sports’ debt.

Envision declines

Envision Healthcare’s 8¾% senior notes due 2026 (Ca/CC) continued to weaken on Monday, a source said.

The notes were quoted down 3¼ points at 60¾ bid on $5 million of trading volume.

On Friday, the issue from the Nashville-based health care company and hospital-based physician group dove 5¾ points.

Distressed returns weak

Distressed index returns remained soft on Friday.

The S&P U.S. High Yield Corporate Distressed Bond index’s one-day total return was minus 0.45%, compared to minus 1.52% on Thursday, 0.03% on Wednesday, minus 0.79% on Tuesday and minus 1.46% at the week’s start.

Month-to-date total return declines widened to minus 2.81% from minus 2.36% on Thursday, minus 0.85% on Wednesday, minus 0.88% on Tuesday and minus 0.09% on Nov. 15.

Year-to-date total returns posted at 25.41% versus 25.98% on Thursday, 27.92% on Wednesday, 27.89% on Tuesday and 28.91% at the beginning of the week.

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