Spirit Airlines holds ground over session; DISH paper improves; distressed index down

By Cristal Cody

Tupelo, Miss., Jan. 18 – Spirit Airlines Inc.’s 8% senior secured notes due 2025 (B2) held steady on Thursday despite the nearly $60 million of bonds changing hands.

The notes went out flat on the day but still more than 20 points weaker after a federal judge blocked the company’s $3.8 billion merger with JetBlue Airways Corp. on Tuesday.

The issue plunged over 15 points on Tuesday and declined more than 7 points on Wednesday.

Distressed bonds in the DISH Network Corp. name were one of the day’s stronger performers in the bulk of secondary action, a source said.

DISH’s paper had been under renewed pressure following its distressed debt exchanges launched Tuesday but on Thursday had turned stronger and went out about 1 point to 3 points better.

DISH DBS Corp.’s 5¼% senior secured notes due 2026 (B2/B-) recovered 1 point after sliding over 6 points in the first two sessions of the week.

Overall market tone was improved on Thursday with stocks on the mend after softening in the prior two sessions.

The iShares iBoxx High Yield Corporate Bond ETF rose 16 cents, or 0.21%, to $77.04.

Meanwhile, month-to-date total returns in the S&P U.S. High Yield Corporate Distressed Bond index were hovering in the negative 3.6%-plus area so far in January.

Spirit unchanged on day

Spirit Airlines’ 8% senior secured notes due 2025 (B2) were volatile but finished the session unchanged on the day at 52 bid and carrying a yield of 53.35%, a source said.

The bonds topped trading action across the junk space on $59.9 million of secondary supply on Thursday.

On Tuesday, the notes dropped over 15 points to a 59 bid handle and a yield of 43.71% following the federal judge’s ruling against the JetBlue takeover.

The Justice Department had taken a stance against JetBlue’s acquisition of the Miramar, Fla.-based low-cost airline based on antitrust laws.

Spirit Airlines’ stock (NYSE: SAVE) has declined more than 50% over the week. Shares closed Tuesday down over 47% at $7.92, fell further to $6.14 on Wednesday and finished Thursday 7.17% lower at $5.70. The stock closed the prior week at $14.97.

DISH notes pick up

DISH DBS’ 5¼% senior secured notes due 2026 (B2/B-) recovered 1 point to trade at a quote of 75½ bid on Thursday on nearly $18 million of volume, a source said.

The bonds slid over 6 points in the first two sessions of the week.

DISH DBS’ 7¾% senior notes due 2026 (Caa2/CC) also traded 1 point higher over the day to hit 56 bid. Volume totaled $18.9 million.

On Tuesday, parent EchoStar Corp. announced that DISH DBS Issuer LLC had started exchange offers and consent solicitations for four tranches of senior notes trading at distressed levels at considerations below par.

The Englewood, Colo.-based satellite cable company’s exchange offers, considered distressed by Moody’s Investors Service, expire Feb. 12.

Distressed index declines

S&P U.S. High Yield Corporate Distressed Bond index one-day total returns fell on Wednesday to minus 0.86% from minus 0.59% on Tuesday.

Month-, quarter- and year-to-date total returns dropped midweek to minus 3.62% versus negative 2.79% on Tuesday.

© 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.