Bausch Health notes flat to lower; Bed Bath & Beyond in turmoil; Toledo Hospital stable

By Cristal Cody

Tupelo, Miss., Sept. 6 – Bausch Health Cos. Inc.’s paper traded flat to ¾ point lower as one of the most active distressed names seen in otherwise mostly light secondary trading in the post-Labor Day market on Tuesday.

Bausch’s 9¼% senior notes due 2026 (Caa3/CC/C) fell ¾ point on $13 million of volume during the session.

Bed Bath & Beyond Inc.’s notes softened in mostly light trading in the first session back after the Friday death of the company’s chief financial officer was confirmed over the weekend.

The distressed retailer’s 5.165% senior notes due 2044 (Caa3/CCC) dropped more than 2¼ points on $2 million of paper traded on Tuesday.

Shares slid more than 18% over the day.

Financial markets overall were weaker with stocks down across the board on Tuesday. The S&P 500 index softened 0.41%.

The iShares iBoxx High Yield Corporate Bond ETF declined 20 cents, or 0.27%, to $74.11.

In other distressed names, Toledo Hospital’s 5.325% senior secured notes due 2028 (Baa3/BB) were mostly unchanged from Friday but trading more than 5 points better so far in September.

Bausch paper active

Bausch’s 9¼% senior notes due 2026 (Caa3/CC/C) fell ¾ point to 58¾ bid on $13 million of secondary activity on Tuesday, a market source said.

The company’s paper was among the most active distressed names seen over the day.

Bausch’s 5½% secured notes due 2025 (B3/B/BB-) went out unchanged at 81¼ bid on $9 million of paper traded.

Bausch’s 5¼% senior notes due 2031 (Caa3/CC/C) rallied 1½ points by the end of the day to a quote of 39 bid on $4 million of volume.

The company’s paper has mostly declined since Bausch last week announced plans for a debt restructuring to replace existing senior debt with new first-lien and second-lien secured bonds.

The Laval, Quebec-based pharmaceutical company plans to spin off Bausch + Lomb.

Bed Bath & Beyond lower

Bed Bath & Beyond’s 5.165% senior notes due 2044 (Caa3/CCC) declined more than 2¼ points on $2 million of paper traded on Tuesday, a source said.

The notes were quoted with an 18 handle.

The Union, N.J.-based home products retailer on Wednesday announced strategic changes, including that it secured more than $500 million of new financing and plans a potential offering of up to 12 million shares of common stock.

Bed Bath & Beyond also reported it has identified 150 lower-producing stores for closure, intends to exit three of its nine labels and that it is in the early phase of the search process for a new chief executive officer.

The retailer announced the ouster of its previous CEO and other senior leadership changes in June.

Bed Bath & Beyond plans to release second-quarter results on Sept. 29.

On Friday, company CFO Gustavo Arnal reportedly fell to his death from an apartment window in New York.

Bed Bath & Beyond said in a statement on Sunday that the entire organization was saddened by “this shocking loss.”

The company’s stock sank 18.42% on Tuesday to $7.04.

Toledo Hospital steady

Toledo Hospital’s 5.325% senior secured notes due 2028 (Baa3/BB) were mostly unchanged at 71¼ bid over the day, a source reported.

The notes have improved more than 5 points since the end of August.

Toledo Hospital’s paper gave back more than 30 points in August after ending July at the 97 bid area.

S&P Global Ratings dropped the Ohio-based health care company, doing business as ProMedica Health System, Inc., to junk status on Aug. 9.

Moody’s Investors Service placed the company on review for downgrade on Aug. 22.

Distressed index soft

S&P U.S. High Yield Corporate Distressed Bond index one-day total returns finished Friday up at 0.24% versus minus 1.28% on Thursday, minus 0.39% on Wednesday, minus 0.71% on Tuesday and minus 0.9% at the week’s start.

Month-to-date total returns for September declined in the Friday session to minus 1.05% from 0.67% on Thursday.

Year-to-date total returns improved on Friday to minus 21.92%, compared to minus 22.11% on Thursday, minus 21.1% on Wednesday, minus 20.79% on Tuesday and minus 20.23% in the Aug. 29 session.

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