UPC, Northern Oil price; Hexion, Guitar Center firm on earnings; Nortel weakens

By Stephanie N. Rotondo

Phoenix, May 13 – Secondary high-yield activity was spurred by fresh earnings and news items on Wednesday.

Hexion Inc., for instance, reported its first quarter results, and investors reacted positively to the numbers, pushing the paper higher.

Guitar Center Inc. also reportedly came out with earnings. Like Hexion, bonds were better after the figures were announced to investors.

Meanwhile, Nortel Networks Inc. was called the day’s “most notable” name, as the company’s debt continued to weaken following news out Tuesday regarding the remaining allocation of funds.

In primary news, two issuers, coming with single-tranche drive-by deals, raised a combined total of $528 million on Wednesday.

Amsterdam-based UPC priced a $340 million tack-on to its 5 3/8% senior secured notes due Jan. 15, 2025 (Ba3/BB) at 99.5 to yield 5.438%.

And Northern Oil and Gas, Inc. priced a $200 million issue of notes mirroring its 8% senior notes due June 1, 2020 (Caa1/B-) at 95 to yield 9.263%.

Overall, market indicators turned mixed on Wednesday.

The CDX North American Series 24 index fell a tenth of a point to 106.6 bid, 106.7 offered, according to a market source.

But the KDP High Yield index inched up to 71.46, with a 5.26% yield. That compared to 71.44, with a 5.28% yield, as of Tuesday’s close.

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