Denbury mixed as early exchange results come in; Frontier lower in telecom space

By James McCandless

San Antonio, June 17 – The activity in the Monday distressed debt session could be seen as a holdover from last week’s drivers.

Denbury Resources Inc.’s notes finished mixed after the company released early participation results for its exchange offers for three tranches.

Elsewhere in energy, Ensco Rowan plc’s issues fell with oil futures while California Resources Corp.’s and Weatherford International plc’s paper was mixed.

Telecom name Frontier Communications Corp.’s notes were lower amid sustained chatter of a potential restructure.

Satellite company Intelsat SA’s issues saw a boost.

In retail, PetSmart, Inc.’s paper moved lower one trading day after its e-commerce segment Chewy.com launched an initial public offering.

Sector peer J. C. Penney Co., Inc.’s notes improved.

Generic drugmaker Teva Pharmaceutical Industries Ltd.’s issues were mixed, remaining a topical name in the space.

Denbury mixed

Denbury’s notes moved in opposite directions on Monday, traders said.

The 6 3/8% notes due 2021 rose 1 point to close at 80½ bid. The 5½% notes due 2022 fell 1½ points to close at 59½ bid.

On Tuesday morning, the Plano, Texas-based independent oil and gas producer announced early participation results of its exchange offers to eligible holders of three tranches.

As of June 14, early participants validly tendered about $107.5 million principal amount of 2021 notes, $173.3 million principal amount of 2022 notes and $257.3 million principal amount of old second-lien notes, Prospect News reported.

The exchange offers expire on June 28.

Oil futures lose

As oil futures fell, distressed energy names were largely mixed, market sources said.

Los Angeles-based producer California Resources’ paper saw mixed results.

The 6% notes due 2024 jumped up 5 points to close at 63 bid. The 8% notes due 2022 slipped 2½ points to close at 66¾ bid.

London-based contract driller Ensco Rowan’s issues declined.

The 5.2% notes due 2025 shed 1¼ points to close at 66¾ bid. The 7¾% notes due 2026 declined by 2 points to close at 70½ bid.

Baar, Switzerland-based oilfield services producer Weatherford’s notes were also mixed.

The 8¼% notes due 2023 dropped 1 point to close at 49½ bid. The 9 7/8% notes due 2024 held level at 51 bid.

West Texas Intermediate crude oil futures for July delivery ended the day 58 cents lower at $51.93 per barrel.

North Sea Brent crude oil futures for August delivery finished at $60.94 per barrel after a $1.07 decline.

Frontier lower, Intelsat up

Meanwhile, in the telecom space, Frontier’s issues headed lower, traders said.

The 10½% notes due 2022 shaved off ¾ point to close at 66¼ bid. The 11% notes due 2025 trimmed ¼ point to close at 61¾ bid.

On Friday, talk surrounding the Norwalk, Conn.-based company arose on whether it should restructure.

Recently, the company added members to its board with restructuring expertise while news reports suggested that creditors were pushing the company to act on its 2022 maturity wall.

“There’s still some of that talk today,” a trader said. “If that’s all people can talk about this week, it might get to a point where they’ll have to respond.”

Luxembourg-based satellite operator Intelsat’s paper gained.

Intelsat Jackson Holdings SA’s 5½% paper due 2023 tacked on 1¼ points to close at 91¼ bid. Intelsat (Luxembourg) SA’s 8 1/8% paper due 2023 added 1¾ points to close at 77¼ bid.

PetSmart off, J.C. Penney up

Retailer PetSmart’s notes moved lower on Monday, market sources said.

The 8 7/8% notes due 2025 fell 1 point to close at 98½ bid. The 5 7/8% notes due 2025 lost ½ point to close at 97 bid.

The Phoenix-based pet supplies name’s structure snapped a four-day positive streak that led up to its e-commerce arm Chewy.com launching an IPO on Friday.

The company raised more than $1 billion.

Plano, Texas-based department store chain J.C. Penney’s issues improved.

The 8 5/8% notes due 2025 picked up ½ point to close at 50 bid.

Teva mixed

Drugmaker Teva’s paper saw a mixed day, traders said.

The 3.15% paper due 2026 dipped 1¾ points to close at 77½ bid. The 4.1% paper due 2046 gained ¼ point to close at 67¾ bid.

The Petach Tikva, Israel-based generic drug producer has seen heightened pressure in the last few weeks as the market ponders the extent of its legal exposure.

After settling a recent opioid-related case for $85 million, analysts weighed in on whether more payouts were coming.

“There are a few pending cases down the line that are going to keep people wondering,” a trader said. “They can’t keep paying people at this level forever.”

© 2015 Prospect News.
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