NII to offer iPhone, bonds push higher; Exide shrugs off $40 million lawsuit; TXU drama coming

By Stephanie N. Rotondo

Phoenix, Jan. 17 - There was "not too much blood" in the distressed debt arena on Friday, according to a trader.

One of the day's big winners was NII Holdings Inc., the Reston, Va.-based provider of Nextel mobile phone service in Latin America. The company's bonds - which had been gaining already from news earlier in the week - packed on a couple more points after it was announced that the latest iPhone would be offered in Brazil.

Exide Technologies was meantime firm as well, even as the South Coast Air Quality Management District filed a $40 million lawsuit against the company.

Away from those names, the space was dominated by the usual suspects.

RadioShack Corp.'s 6¾% notes due 2019 were seen up half a point at 58¼ by one trader. Another trader said the debt was active in a 57¼ to 58 context.

Caesars Entertainment Corp.'s 10% notes due 2018 continued to be active, trading up slightly to 513/4, a trader said. The trader also saw the 10¾% notes due 2016 rising half a point to 811/2.

Another trader said Overseas Shipholding Group Inc.'s 8 1/8% notes due 2018 "continues to move up," pegging the paper at "116-ish" bid.

NII to offer iPhone

NII Holdings got another shot in the arm on Friday after the company said it would offer the iPhone 5S and 5C in Brazil.

A trader said the 10% notes due 2016 pushed up a point to 623/4, while the 8 7/8% notes due 2019 rose 1½ points to 473/4. The 7 5/8% notes due 2021 gained just over a point to end around 441/2.

Earlier in the week, the company had seen its bonds begin to gain ground on news it had inked a network-sharing agreement with Telefonica, allowing it to provide 3G coverage to its subscribers.

Exide shrugs off lawsuit

Exide Technologies 8 5/8% notes due 2018 "have been creeping up," a trader said Friday.

Even news of a $40 million lawsuit filed late Thursday did little to damper the debt, he said.

He placed the bonds around 76.

The South Coast Air Quality Management District filed the lawsuit against the Milton, Ga.-based battery manufacturer and recycler on Thursday, citing toxic emissions from the company's Vernon, Calif.-based recycling plant.

The plant had previously been closed in early 2013 after state regulators found leaks at the plant. An administrative judge then allowed operations to reopen, but the latest suit calls for the center to be shuttered once again.

Exide reached a settlement with the state of California in May, agreeing to invest $7.7 million in the property for upgrades. The company also agreed to provide funding for health education related to its emissions.

TXU drama imminent

Energy Future Holdings Corp. will likely soon have to face its day of reckoning, a trader said Friday.

"Something is going to have to happen there," the trader said of the Dallas-based power producer. The company is highly leveraged and could possibly put one or more of its subsidiaries into bankruptcy in order to deal with its said debt load.

The trader noted that with the company next earnings report, an auditor report should follow, in which the company's ability to continue as a going concern should be addressed.

The parent company's 10% notes due 2020 traded Friday around 107, while the 10¼% subordinated notes due 2015 linked to Texas Competitive Electric Holdings Co. LLC - one subsidiary possibly facing the block - traded around 5.

© 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.