Ultra Petroleum falls as negotiations stall, borrowing base cut; Community Heath up

By James McCandless

San Antonio, Sept. 26 – Distressed debt trading shifted focus toward energy names on Wednesday as oil futures ended mixed and U.S. oil inventories rose for the first time in six weeks.

Taking much of the spotlight on Wednesday was Ultra Petroleum Corp., which reported late Tuesday that it was working to renegotiate the terms of its senior secured first-lien term loan and borrowing base.

The oil developments of the day led to mixed results in other independent oil and gas names, namely California Resources Corp. and Sanchez Energy Corp., both bellwethers of the sector. Petroleum transporter Navios Maritime Holdings Inc. declined.

Elsewhere, in the medical sector, Community Health Systems, Inc.’s notes traded upward on news that a subsidiary would pay $260 million to settle criminal charges with the Department of Justice.

Fitch Ratings said that American Tire Distributors Inc. might file for bankruptcy at the end of the month, entering a 30-day grace period after failing to make a Sept. 1 interest payment. The company's bonds, while higher than its recent 24½ floor, declined.

In distressed telecom, Intelsat SA’s notes gained while Frontier Communications Corp.’s issues were mixed.

Meanwhile, the Fresh Market Inc.’s paper saw a boost after the private company reported its earnings late Tuesday.

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