Hertz notes active on forbearance news; L Brands paper drops after asset sale nixed

By James McCandless

San Antonio, May 5 – The distressed debt space remained focused on the newsmakers in the retail sector and earnings releases on Tuesday.

Hertz Global Holdings, Inc.’s notes saw more varied movements on news that it had reached a forbearance agreement with lenders.

The 6¼% senior notes due 2022 jumped up 7½ points to close at 17 bid. The 5½% senior notes due 2024 shaved off ½ point to close at 14½ bid.

During the Tuesday session, news broke that the Estero, Fla.-based car rental company had reached a forbearance agreement with creditors.

The agreement extends a deadline for certain lease payments that it did not make last week to May 22.

According to the company, the extension gives it time to “develop a financing strategy and structure that better reflects the economic impact of the Covid-19 global pandemic.”

“The bankruptcy talk is a little premature,” a trader said. “They’ll file when they need to. But I don’t think they will file this month.”

In the retail space, L Brands, Inc.’s issues dropped in reaction to the announcement that an asset sale had been terminated.

The 6¾% senior notes due 2036 lost ¼ point to close at 73¾ bid. The 5¼% senior notes due 2028 trailed by 2¾ points to close at 70½ bid.

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