Distressed market activity wanes ahead of holiday; Denbury drops on exchange news

By Stephanie N. Rotondo

Seattle, Dec. 22 – As the Christmas holiday neared, there was “not much volume” in the distressed bond market on Tuesday.

“It’s starting to wind down for year’s end,” a trader said. However, he added that there was “still some bid-wanted, offer-wanted activity” as investors looked to jockey their positions.

The result was a market that was fairly mixed on the day, though still mostly centered on commodities.

Denbury Resources Inc., for instance, saw some trading after the company said late Monday that it was launching a private exchange offer for three series of notes.

Chesapeake Energy Corp. was meantime mixed in the wake of its early tender results on its own private exchange offer.

Away from that space, there was some action in J.C. Penney Co., Inc.’s 6 3/8% notes due 2036, according to a trader.

The trader saw the bonds rising “almost 3 points” to 62 7/8, though there was no fresh news to act as a catalyst.

Meanwhile, iHeartMedia Inc.’s 9% notes due 2021 improved a point to 68¾.

Denbury Resources announced late Monday that it would privately exchange its 6 3/8% notes due 2021, 5½% notes due 2022 and 4 5/8% notes due 2023 for up to $650 million of new 7½% notes due 2022.

Come Tuesday trading, a trader saw the 5½% notes dropping nearly 5 points to 32.

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