Outerwall bonds pop on private equity takeover; W&T Offshore debt up post-exchange news

By Stephanie N. Rotondo

Seattle, July 25 – Trading in the distressed debt arena was once again overshadowed by the overall high-yield space on Monday, but not without good reason.

News of a $1.375 billion tender offer for Post Holdings Inc.’s 7 3/8% senior notes due 2022 was turning heads, as was the company’s new $1.75 billion issue of 5% 10-year notes.

Among more distressed-leaning names, Outerwall Inc. was the day’s “big news,” according to a trader. The owner and operator of RedBox and Coinstar kiosks announced early Monday that it was being taken private by Apollo Global Management in a deal valued at $1.6 billion.

“The bonds were way up,” a trader said. He saw the 7 5/8% notes due 2021 trade as high as 102 before settling back in around 101, up from 87 previously.

In March, the company said it was exploring strategic alternatives after seeing revenues decline for three years straight. Under the terms of the buyout, shareholders will receive $52 in cash, representing a 51% increase over the share price back in March.

There was some movement in the distressed energy space, as domestic crude oil prices slumped again.

“Oil is languishing around $43 a barrel,” a trader said.

W&T Offshore Inc.’s 8˝% notes due 2019 were one of few oil and gas names that actually gained ground for the day, as the Houston-based oil and gas company launched an exchange offer for the debt.

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