Rite Aid down after tender offer wraps; Endo up; Bausch lower; EnLink Midstream softens

By Cristal Cody

Tupelo, Miss., June 28 – Rite Aid Corp.’s 8% senior secured notes due 2026 (B3/CC/BB-) fell about 1¾ points on Tuesday after the company passed on accepting the paper in its tender offer.

The notes have dropped 2 points since Friday.

In other active distressed paper, Endo International plc’s bonds climbed as the market absorbed an investor group’s report of plans to seek further value in the company, including a debt exchange.

Endo’s secured notes were trading more than 1 point better by the close.

Also in the pharmaceutical space, Bausch Health Cos. Inc.’s bonds were under pressure on Tuesday with the paper seen down about 2¼ points to over 3 points.

The day’s financial tone was off with stock indices down across the board.

The iShares iBoxx High Yield Corporate Bond ETF finished 1.1% lower at $73.76.

Crude oil was one of the bright spots.

West Texas Intermediate crude oil benchmark futures for August deliveries settled $2.19 higher at $111.76 a barrel.

Natural gas processor EnLink Midstream Partners LP’s securities have been soft in June and were quoted down about ¼ point in light trading on Tuesday.

Rite Aid declines

Rite Aid’s 8% senior secured notes due 2026 (B3/CC/BB-) fell about 1¾ points to 80¼ bid by the end of the day, a market source said.

Rite Aid announced that its tender offers for up to $150 million of paper from four series of bonds were oversubscribed by Monday’s early deadline. The tender offers were set to expire on July 12.

Rite Aid accepted $114.94 million of the $600 million outstanding of 7½% senior secured notes due 2025, $26.96 million of the $29 million outstanding of 6 7/8% debentures due 2028 and $51.7 million of the $237.39 million outstanding of 7.7% senior debentures due 2027.

The company said it accepted none of the $558.78 million of notes tendered from the $849.92 million outstanding of its 8% senior secured notes due 2026.

Rite Aid’s 7.7% senior debentures due 2027 (Caa2/CC/CCC) dropped more than 3 points to the 64 bid area by the close on Tuesday.

The Camp Hill, Pa.-based drug retailer in the prior week reported a wide first-quarter loss.

Endo heads up

Endo’s bonds improved in active secondary trading over Tuesday’s session following the investor group’s release the previous day, sources said.

Endo Finance LLC’s 6% senior notes due 2028 (Caa3/CC) rose 1 7/8 points to 9 3/8 bid on $7 million of paper traded.

Endo Luxembourg Finance Co. Sarl’s 6 1/8% senior secured first-lien notes due 2029 (Caa2/CCC) improved about 1¼ points to the 76¾ bid area by the end of the session.

Endo subsidiary Par Pharmaceutical Inc.’s 7½% senior secured notes due 2027 (Caa2/CCC) also were over 1 point better by late in the day at 77 bid on $7 million of volume.

On Monday, a group of Endo’s unsecured noteholders announced it had retained legal and financial advisers and proposed several transactions to Endo, including a cash tender offer or a debt-for-debt exchange.

The Dublin-based pharmaceuticals manufacturer’s bonds have been under pressure since May on weak first-quarter earnings and a forecasted second-quarter loss.

Bausch Health drops

Bausch Health’s notes slid about 2¼ points to over 3 points on $13 million of paper traded on Tuesday, a source said.

Bausch Health Americas, Inc.’s 8½% senior notes due 2027 (B3/B-/B) declined 2 7/8 points to 72 bid on $4 million of secondary volume.

Moody’s Investors Service and S&P Global Ratings downgraded the Laval, Quebec-based pharmaceutical company in May.

EnLink paper lower

EnLink Midstream’s 5.45% senior notes due 2047 (Ba1/BB+/BB+) have been trading with a handle in the low 70s over the back half of June, a market source said.

The notes were down about ¼ point in light trading at the 72½ bid area on Tuesday.

The issue traded at better than par at the start of the year.

The Dallas-based natural gas processor and pipeline operator’s 6% perpetual preferred stock (Ba3/B+/BB-) has declined over 10 points since the start of the year.

The issue was quoted at 67¾ bid in thin secondary action over the session.

Distressed returns down

S&P U.S. High Yield Corporate Distressed Bond index returns softened at the start of the week.

One-day total returns declined to minus 0.11% on Monday from 0.13% on Friday.

Month-to-date total returns softened to minus 5.92% from minus 5.82% ahead of the weekend.

Year-to-date index returns were lower Monday at minus 19.57% versus minus 19.48% on Friday.

© 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.