TPC jumps after bankruptcy filing; Bausch mixed post downgrade; AMC, Bed Bath fall

By Abigail W. Adams

Portland, Me., June 1 – Distressed credits were active on Wednesday as the broader market gave back gains from the strong rally the previous week.

TPC Group Inc. was in focus with its 10½% senior secured notes due 2024 (Caa3/D) jumping double digits after the petrochemical company filed for bankruptcy.

Bausch Health Cos. Inc.’s capital structure continued to see heavy volume with its senior notes mixed after a ratings downgrade.

The rally in distressed retail, leisure and entertainment names came to a halt on Wednesday with AMC Entertainment Holdings, Inc.’s senior notes and Bed Bath & Beyond Inc.’s 5.165% senior notes due 2044 (B3/B+) leading losses in the secondary space.

TPC bankruptcy

TPC Group’s 10½% senior secured notes due 2024 were in focus on Wednesday as the company became the 21st to file for Chapter 11 bankruptcy protection in 2022.

The 10½% notes jumped 15 points to close Wednesday at 52½, according to a market source.

They closed the previous session on a 37-handle.

The notes saw heavy volume with $13 million on the tape heading into the market close.

The petrochemical company’s 10 7/8% senior secured notes due 2024 were unchanged with the notes remaining around par, a source said.

TPC Group filed for Chapter 11 bankruptcy protection on Wednesday and entered into a restructuring support agreement with holders of 88% of the $205.5 million outstanding 10 7/8% secured notes due 2024 and about 78% of the company’s $930 million outstanding 10½% secured notes due 2024, Prospect News reported.

Bausch Health mixed

Bausch Health’s capital structure was mixed in active trading on Wednesday following an S&P ratings downgrade.

The company’s 5% senior notes due 2029 (B3/B-) climbed ¾ point to close the day at 60¾ with a yield of 14.29%, a market source said.

There was $16 million in reported volume.

The 5% notes due 2028 (B3/B-) climbed more than 1 point to close Wednesday at 64¾ with a yield of 14.287%.

There was $9 million in reported volume.

The 5¼% senior notes due 2030 (B3/B-) also rose 1 point to 59½ with a yield of 14%.

The 5¼% senior notes due 2031 (B3/B-) were up 1 3/8 points to close at 60 3/8 with a yield of 13%.

However, Bausch Health’s high dollar price 9¼% senior notes due 2026 (B3/B-) were down slightly with the notes shaving off 3/8 point to close at 84 with a yield of 14.86%.

Bausch Health’s senior notes have been active since S&P lowered its ratings on the company’s secured debt to BB- from BB and on their unsecured debt to B- from B.

The rating agency cited lower-than-expected proceeds from Bausch + Lomb’s IPO and operational headwinds as cause for the downgrade with the company’s deleveraging efforts expected to slow.

Losers

The rally in entertainment and retail names came to an end on Wednesday.

After posting gains for the previous four sessions, AMC’s senior notes were among the largest losers in the space on Wednesday.

The movie chain operators 6 1/8% senior notes due 2027 led losses in the secondary space with the notes crashing 6 points.

After trading as high as 52 on Tuesday, there were round-lot trades of 46 on Wednesday with the yield now 26.2%.

AMC’s 10% senior notes due 2026 sank 2 points to close the day at 75½ with the yield 19%.

Bed Bath & Beyond’s 5.165% senior notes due 2044 were also down as the retail rally faded.

The 5.165% notes sank 1½ points to close the day at 43 1/8 with the yield now 13%.

© 2015 Prospect News.
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