Bausch paper stronger; AMC theater notes improve; AMC cable bonds gain; LifePoint up

By Cristal Cody

Tupelo, Miss., July 7 – Distressed bonds from Bausch Health Cos. Inc. rallied about ¼ point to nearly 3 points on Friday with the name outpacing AMC Entertainment Holdings, Inc. for the most secondary action.

Bausch’s 9¼% notes due 2026 (Ca/CCC-/CC) traded about 3 points better on nearly $10 million of volume.

AMC Entertainment Holdings’ 10% senior secured second-lien notes due 2026 (Caa3/CCC-) took back some of Thursday’s weakness when the issue fell ¾ point. The notes traded Friday ½ point better.

Cable channel company AMC Networks Inc.’s 4¼% senior notes due 2029 (Ba3/BB-) also were active on Friday. The notes traded more than 1 point better at 53¾ bid on $6 million of activity, a source said.

In other distressed health care paper, LifePoint Health, Inc.’s 9¾% senior notes due 2026 (Caa1/CCC-) improved ¼ point in mostly light trading.

Volatility pulled back on Friday with the CBOE Volatility index down 3.95% to 14.83 by the close, though equities remained under pressure.

The S&P 500 index fell 0.29%.

The iShares iBoxx High Yield Corporate Bond ETF added 7 cents, or 0.09%, to $73.85.

Bond gains over the week were “concentrated in just a handful of tickers” that included Bausch and LifePoint, according to a research note on Friday from BofA Securities credit strategist Oleg Melentyev.

Bausch paper gains

Bausch’s notes rallied about ¼ point to nearly 3 points on secondary supply that totaled more than $18 million on Friday, a market source said.

Bausch Health Americas, Inc.’s 9¼% senior notes due 2026 (Ca/CCC-/CC) traded about 3 points better with an 86 bid handle on $9.74 million of volume.

Bausch’s 6¼% senior notes due 2029 (Ca/CCC-/CC) added more than 2 points to a quote of 43 bid on $5 million of volume.

The 6 1/8% senior secured notes due 2027 (Caa1/CCC+/B) were up more than ½ point with a 64 bid handle on $2.2 million of trading.

Bausch’s 4 7/8% senior secured notes due 2028 (Caa1/CCC+/B) also traded nearly ¼ point higher with a 58 bid handle on $2 million of volume.

On Friday, Bausch reported a subsidiary entered into a $600 million five-year revolving credit facility with investment firm KKR.

Bausch + Lomb Corp. also was in the news on plans to buy Johnson & Johnson’s eye and contact lens drops brand Blink for $106.5 million, which follows another acquisition announced a week ago.

The Bausch subsidiary reported in the previous week that it entered into a definitive agreement with Novartis to acquire a non-steroid eye drop and other applications for up to $2.5 billion, including an upfront payment of $1.75 billion in cash.

The Laval, Quebec-based pharmaceutical company’s stock (NYSE: BHC) rallied 8.45% on Friday to $8.34.

AMC notes higher

AMC Entertainment’s 10% senior secured second-lien notes due 2026 (Caa3/CCC-) were up ½ point at 70¾ bid on $7 million of volume on Friday, a source said.

The bonds took back some of Thursday’s weakness when the issue fell ¾ point to 70¼ bid on nearly $15 million of trading.

A ruling still awaits from a settlement hearing held last week in the Delaware Court of Chancery to resolve a shareholder lawsuit brought by Allegheny County Employees’ Retirement System over AMC’s issuance of preferred stock.

The Leawood, Kan.-based movie theater owner’s common stock (NYSE: AMC) closed Friday down 2.1% at $4.20.

AMC’s preferred stock (NYSE: APE) finished up 3.93% at $1.85.

LifePoint trades

LifePoint Health’s 9¾% senior notes due 2026 (Caa1/CCC-) traded ¼ point better on Friday at 84¼ bid, a market source said.

Trading supply in the name during the session was light with $1.55 million of volume reported.

The issue has gained about 5 points since May.

The health care services company is based in Brentwood, Tenn.

Distressed index drops

S&P U.S. High Yield Corporate Distressed Bond index one-day total returns dropped to minus 0.62% on Thursday from 0.05% on Wednesday and 0.12% at the start of the holiday week.

Month-to-date total returns for July fell to minus 0.45% on Thursday from 0.18% in the prior session.

Year-to-date distressed total returns softened to 11.13% on Thursday from 11.82% on Wednesday and 11.76% on Monday.

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