Distressed investors focus on topical names; Lucent busy as new deal prices; Molycorp weakens

By Stephanie N. Rotondo

Phoenix, Nov. 8 - Recently topical distressed names stayed busy during Friday's session.

NII Holdings Inc. bonds were "about in line, maybe a smidge lower," a trader said, seeing the 7 5/8% notes due 2021 in a 53½ to 54 zip code.

Another trader pegged the issue at 533/4, down half a point. However, he said the 8 7/8% notes due 2019 were up almost a point at 57.

Affinion Group Inc. paper was also busy, just one day after reporting earnings and announcing a private exchange offer for its 2015 maturities.

One trader said the 11 5/8% notes due 2015 were the "winner on the day," rising 3 points to 831/2. He called the 11½% notes due 2015 up 1½ points at 101.

A second trader pegged the 11½ in a 101 to 102 context, up from 99-par previously.

Struggling retailer J.C. Penney Co. Inc. saw its bonds stabilize on Friday. The debt had been trading up recently, but started to back off on Thursday.

A trader deemed both the 7.4% notes due 2037 and the 5.65% notes due 2020 as unchanged at 71½ and 76, respectively.

Another source saw the 7.4% notes at 71 bid, 72 offered and the 5.65% notes around 76.

And, Energy Future Holdings Corp.'s 10½% notes due 2015 were up a touch at 9 1/8.

Lucent busy post-new deal

Alcatel-Lucent SA's 6.45% notes due 2029 were called unchanged on the day, "but on pretty good volume," according to a trader.

The trader saw the bonds trading around 89 1/4.

Another trader placed the issue at 89.

Trading in the paper comes after the Paris-based telecommunications company priced $750 million of 6¾% senior notes due 2020 on Thursday.

One trader said the new deal - which came at par - was moving up to around 101.

"That new deal was up despite what was going on in Treasury rates," he said.

Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC were the joint global coordinators.

Goldman Sachs International, HSBC Securities (USA) Inc., Morgan Stanley & Co. LLC, Natixis Securities Americas LLC, UniCredit Bank AG, BofA Merrill Lynch International, Credit Agricole Securities (USA) Inc. and Deutsche Bank Securities Inc. were the joint bookrunners.

Proceeds will be used to refinance debt and for general corporate purposes.

Molycorp bonds pressured

Molycorp Inc. reported a wider loss for the third quarter on Friday, sending its bonds downward.

Early in the session, the 3.25% convertible notes due 2016 "came in a point," according to the trader, pegging the issue around 69, which compared to a 69.75 to 70 range on Thursday.

However, the stock was trading up about 6.5% as of midday.

"Nobody really trusts the company," the trader remarked, pointing to the company's recent calls for additional cash, even as it cut revenue and production forecasts.

Near the market's close, another trader quoted the convertible notes in a 69 to 70 context.

He also saw the 10% notes due 2016 at 971/2, which compared to 98 bid, 99 offered on Thursday.

The Greenwood Village, Colo.-based mining company attributed its wider loss of lower prices for rare earth metals.

For the quarter, net loss was $69.9 million, or 43 cents per share. That compared to a loss of $18.9 million, or 19 cents per share, the year before.

Revenue dropped 27% to $149.1 million.

Analysts polled by Thomson Reuters were expecting a loss of 28 cents per share on revenue of $161 million.

However, the company was able to trim costs, which fell 18% to $150.4 million.

As of the end of the quarter, cash and equivalents was at $173.9 million. Molycorp is expected to burn through $60 million of that on capital expenditures before the year is out.

Emerging market dealings

In the emerging market space, OGX Petroleo e Gas Participacoes SA's 8 3/8% notes due 2022 finished the day at 91/2, which a trader said was unchanged.

Petroleos de Venezuela SA's bonds were meantime mostly lower on the day.

A trader saw the 5¼% notes due 2017 falling over 2 points to 741/2, while the 5 3/8% notes due 2027 were down a deuce to 561/2.

But the 8½% notes due 2017 managed to put on a little bit, closing at 85 3/4.

In Mexican homebuilders, Desarrolladora Homex SAB de CV's 9¾% notes due 2020 were steady at 16¼ and Corporacion GEO SAB de CV's 9¼% notes due 2030 were up half a point at 16.

© 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.