Halcon debt posts big gains on asset sale news; Frontier paper continues to trend weaker

By Stephanie N. Rotondo

Seattle, July 11 – Halcon Resources Corp. was the nom du jour in the distressed debt market on Tuesday.

“They announced an asset sale and the bonds were rocketing higher,” a trader noted.

In fact, the company’s 6¾% notes due 2025 jumped 14 points on the news, moving over par. Halcon’s equity (NYSE: HK) also saw a sizeable bump with its 51.35% gain.

Meanwhile, Frontier Communications Inc.’s debt was weaker on the day, with one trader calling the bonds down 1 to 1½ points.

That trader saw the 6 7/8% notes due 2025 at 76, the 11% notes due 2025 at 89½ and the 9% notes due 2301 at 76¼.

“The bellwether 11s were trading around 89½, touching new lows,” another trader said. “I guess you could point to the story on the tape about rural telecom names being weaker after Microsoft announced plans to fund projects to bring broadband access to rural areas.

“But it has been a weaker name for awhile in general, so that story was probably just more piling on,” he said.

On Monday, Frontier completed a 1-for-15 reverse stock split, a move that has some wondering if it is the death knell for the company. Just 18 months ago, Frontier acquired Verizon’s wired voice and data lines in Texas, California and Florida. Since then, the company’s bet on landlines – in a time when nearly everything is going digital – has not proved profitable.

© 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.