Rite Aid ramps higher in secondary; deep distressed names mostly quiet in October

By Cristal Cody

Tupelo, Miss., Oct. 18 – Rite Aid Corp.’s bonds continued to attract heavy attention on Wednesday in the secondary market.

Rite Aid’s 8% senior secured notes due 2026 (Ca/D/CC) picked up 3½ points on almost $30 million of volume and were trading about 5 points better since the issuer reported it filed for Chapter 11 bankruptcy on Sunday, a source said.

The bonds were quoted at 70½ bid.

Over the session, stocks in the broader market tanked and Treasury yields shot up.

“Cash management people are putting money into bills mainly yielding about the same 5½% range,” a source reported. “People are putting hordes of money at those levels and not really looking to extend out very much.”

Bonds in deep distressed territory are barely moving in October, according to market sources on Wednesday.

Spanish Broadcasting System Inc.’s 9¾% senior secured notes due 2026 (Caa1/CCC+) remained quiet after the company reported a breach-of-contract lawsuit.

The 9¾% senior secured notes due 2026 (Caa1/CCC+) were last seen in the prior week on a 68 bid handle, down over ½ point from September’s end.

Bonds from Audacy, Inc. and WeWork Inc. also have been thinly traded since the companies missed interest payments this month.

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