| Add to balance / Manage account | User: | Log out |
| Prospect News home > News index > List of issuers M > Headlines for Momentive Performance Materials Inc. > News item |
Distressed debt steady in muted trading due to short holiday week; Momentive enters bankruptcy
By Stephanie N. Rotondo
Phoenix, April 14 - The distressed bond market was muted Monday as the market prepared for a shortened holiday week.
"I think it's going to be a slow week," a trader opined, noting that it was Spring Break and that Passover is Tuesday. Because of the Good Friday holiday, the market will be closed on Friday, which means players could be heading out early come Thursday.
The trader also noted that there was very little news out to spark much movement. However, investors were keeping an eye on Momentive Performance Materials Inc., as the company filed for bankruptcy late Sunday.
The company is slated to launch a $570 million debtor-in-possession facility on Thursday.
Momentive files
Momentive Performance filed for Chapter 11 protections on Sunday, a move that was largely expected by the markets.
But while the filing was expected, that didn't stop investors from pressuring the company's debt.
A trader said the 8 7/8% first-priority senior secured notes due 2020 and the 10% senior secured notes due 2020 were slightly weaker at 108 ½ bid, 109 offered. He noted that the issues were still trading with accrued interest because "people are expecting them to get taken out, so you will get your accrued interest."
However, the 9% second-priority senior secured notes due 2021 were trading flat, or without accrued interest. The trader pegged that issue at 79, down from an intra-day high around 83.
With assets of $2.69 billion and debt of $4.17 billion, the specialty chemicals manufacturer has not posted a profit since its 2006 leveraged buyout by Apollo Global Management LLC.
The debt incurred in the LBO made the company especially susceptible to market fluctuations.
The company hopes to eliminate as much as $3 billion in debt via the bankruptcy court.
Albany, N.Y.-based Momentive is scheduled to launch a $570 million DIP facility on Thursday. JPMorgan Securities LLC is the lead arranger.
© 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.