Chesapeake notes dip as bankruptcy process starts; American Airlines notes in focus

By James McCandless

San Antonio, June 30 – Energy and travel sector names were the continued focus of distressed debt trading on Tuesday.

Chesapeake Energy Corp.’s notes dipped as the company starts its bankruptcy process after coming to a restructuring agreement with lenders.

The 7% senior notes due 2024 shaved off ½ point to close at 3½% bid. The 11½% senior notes due 2025 fell ¾ point to close at 11 bid.

The Oklahoma City-based independent oil and gas producer was granted interim access to $325 million of its new-money debtor-in-possession financing, Prospect News reported.

Over the weekend, the company filed for Chapter 11 bankruptcy after striking a restructuring agreement with 100% of the lenders under its revolving credit facility, holders of 87% of its term loan agreement obligations, holders of 60% of its senior secured second-lien notes due 2025 and holders of 27% of its senior unsecured notes.

In all, about $7 billion of debt is expected to be slashed from the company’s balance sheet.

Meanwhile, American Airlines Group Inc.’s notes diverged as more coronavirus cases put the spotlight on the company’s plans to revamp flight capacity.

The 11¾% senior secured notes due 2025 picked up ¼ point to close at 95½ bid. The 4.95% senior secured pass through notes due 2024 gave back 1 point to close at 78¾ bid.

© 2015 Prospect News.
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