Ukraine, Russia paper sinks; Rent-A-Center, Envision lower; Akumin, Mallinckrodt mixed

By Cristal Cody

Tupelo, Miss., Feb. 23 – The financial markets skidded lower by the close on Wednesday after Ukraine declared a state of emergency and fears of a Russian attack grew globally.

Paper from Russia- and Ukraine-based companies sank over the day, a market source said.

Kernel Holding SA’s paper plunged with the Ukrainian agricultural commodities company’s 6½% senior notes due 2024 (B+/BB-) quoted down 9½ points at 75 bid on $6 million of paper traded.

Ukraine steelmaker and miner Metinvest Group’s 7¾% senior notes due 2029 (B+/BB-) dropped over 8½ points to under the 61 bid area on $4 million of secondary volume on Wednesday.

Moscow-based banking and financial services company PJSC Sberbank’s 5 1/8% subordinated notes due Oct. 29, 2022 (Ba1) slid 6 7/8 points to 90 bid on $3.2 million of secondary action.

Market tone was weak in the U.S. markets with the Nasdaq down 2.57% and the S&P 500 off 1.84%.

The iShares iBoxx High Yield Corporate Bond ETF closed down 15 cents to $82.55.

Oil prices were flat to modestly higher.

West Texas Intermediate crude oil benchmark futures for April deliveries settled up 19 cents to $92.10 a barrel.

Meanwhile, Rent-A-Center, Inc.’s 6 3/8% senior notes due 2029 (B1/B) dove over 10¼ points on Wednesday to 88½ bid on over $6 million of secondary volume after the company reported weak earnings, a source said.

Rent-A-Center sold $450 million of the notes in February 2021 to fund its acquisition of Acima Holdings, LLC.

The Plano, Tex.-based rental company said fourth-quarter profits dropped to $9.81 million from $56.3 million a year ago, while quarterly revenue rose to $1.17 billion from $716.49 billion a year earlier.

Rent-A-Center’s stock was down 7.82%.

In other action, distressed health care paper was mixed over Wednesday’s session.

Envision Healthcare Corp.’s 8¾% senior notes due 2026 (Ca/CC) fell 2¾ points by the close after trading up ¼ point early in the session.

Akumin Inc.’s senior secured notes were mixed after improving on Tuesday.

Team Health Holdings, Inc.’s 6 3/8% senior notes due 2025 (Caa3/CCC/CCC-) were quiet after softening about ½ point the prior day.

Air Methods Corp.’s 8% senior notes due 2025 (Caa2/CCC) also were not active after trading mostly flat on Tuesday.

Bankrupt pharmaceutical manufacturer Mallinckrodt plc’s notes traded flat to softer in the low 50s area.

Envision declines

Envision Healthcare’s 8¾% senior notes due 2026 (Ca/CC) traded up ¼ point early in the session on Wednesday before the bonds slid 2¾ points to 47 bid by the close, a market source said.

The issue saw $6 million of paper changing hands.

The notes softened about 2¼ points in the prior week.

Nashville-based Envision is a health care company and hospital-based physician group.

Akumin soft

Akumin’s 7% senior secured notes due 2025 (B2/B-) were quoted at the 87¾ bid area on Wednesday, down about 1½ points from where the issue was last seen on Friday, a source said.

The bonds have declined from the 94½ bid range in early January.

The company’s 7½% senior secured notes due 2028 (B2/B-) were not seen during the session after improving over 1 point on Tuesday to 86 bid.

Akumin is a Plantation, Fla.-based outpatient diagnostic imaging services provider.

Team Health quiet

Team Health’s 6 3/8% senior notes due 2025 (Caa3/CCC/CCC-) were last seen trading on Tuesday down about ½ point at 89½ bid, a market source said.

The issue has softened from the 93 bid range at the start of the month.

The Knoxville, Tenn.-based medical staffing firm owned by Blackstone Group LP is marketing a transaction to amend and extend the maturity for its term loan B to 2027 from 2024.

Air Methods unchanged

In other health care services paper, Air Methods’ 8% senior notes due 2025 (Caa2/CCC) were quiet on Wednesday with the issue last trading on Tuesday mostly unchanged at 79 bid, a source said.

The notes from the ASP AMC Holdings Inc. unit have softened from the 81¾ bid area in early February.

The New York-based ambulance service provider issued the notes via ASP AMC Merger Sub Inc.

Mallinckrodt flat to softer

Mallinckrodt’s 5½% senior notes due 2025 were moving down 2½ points to 51 bid by the end of Wednesday’s session, a source said.

The company’s 5¾% senior notes due 2022 headed out unchanged at 52 bid after gaining about ½ point on Tuesday.

Mallinckrodt announced on Feb. 3 that its Chapter 11 bankruptcy reorganization plan was confirmed by the U.S. Bankruptcy Court for the District of Delaware and includes settlements that resolve any opioid-related lawsuit claims.

The pharmaceuticals maker expects to exit Chapter 11 bankruptcy in the first half of 2022.

Distressed returns up

The S&P U.S. High Yield Corporate Distressed Bond index’s one-day total return was positive at the start of the holiday-shortened week on Tuesday.

The daily return rose to 0.03% from minus 0.18% on Friday.

Month-to-date total returns improved to minus 1.24% from minus 1.27% ahead of the long weekend.

Year-to-date returns totaled minus 2.75% on Tuesday versus minus 2.78% on Friday.

© 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.