Diamond Sports declines; CBL notes lower; Talen gains; Envision Healthcare softens

By Cristal Cody

Tupelo, Miss., Oct. 18 – Diamond Sports Group LLC’s bonds remained under pressure on Monday with the notes down 2 points to 3¼ points as parent Sinclair Broadcast Group Inc. seeks new funding.

Elsewhere, real estate investment trust CBL & Associates LP’s bonds settled back to the high 60s after trading as high as 74¼ bid on Friday following the company’s announcement of a new board member and impending Chapter 11 bankruptcy exit.

Energy issues remained mostly stronger despite weaker oil prices.

North Sea Brent crude oil futures for December deliveries fell 53 cents to settle at $84.33 a barrel.

Talen Energy Supply LLC’s bonds traded about 1 3/8 points to 3 5/8 points higher over the day with the 10½% senior notes due 2026 (B3/CCC/B) up 3 5/8 points after gaining 7/8 point on Friday.

Dallas-based energy company EnLink Midstream Partners LP’s 6% perpetual preferreds (B1/B+/BB-) improved 1 3/8 points to 79½ bid on $11 million of volume on Monday, a source said.

Market tone was mixed as the week opened.

The iShares iBoxx High Yield Corporate Bond ETF, which ended Friday down 15 cents, fell another 4 cents on Monday to $87.18.

Looking at the distressed health care space, Nashville-based Envision Healthcare Corp.’s 8¾% senior notes due 2026 (Ca/CC) were down more than 1½ points on Monday to 69 3/8 bid on $2 million of trading volume, a source said.

The issue dropped over 1 point on Friday.

Diamond Sports pressured

Diamond Sports’ 5 3/8% senior secured notes due 2026 (Caa1/CCC) declined 2 points to 57½ bid by late afternoon, a market source said.

The issue saw $17 million of secondary demand Monday.

The notes went out Friday ½ point lower and were down 3½ points on the week.

Diamond Sports’ 6 5/8% senior notes due 2027 (Ca/CC) also dropped 3¼ points to 31¾ bid on $9.5 million of secondary action.

The unsecured notes shed 1¾ points on Friday to end the week off 5 points.

Sinclair Broadcast reported on Oct. 7 that it made a Sept. 28 proposal to secure new funding for the Chesapeake, Va.-based sports broadcast group.

The proposal follows Sinclair’s announcement in June that it made two proposals dated March 22 and April 29 to lenders and noteholders of Diamond Sports.

CBL bonds active

CBL’s 5¼% notes due 2023 were quoted at 69½ bid by the close on Monday, a source said.

The notes were seen Friday ranging from 69½ to 74¼ bid in heavy trading before going out at the 68 bid area.

The Chattanooga, Tenn.-based owner and developer of malls and shopping centers said Friday that it is moving toward a Nov. 1 exit from Chapter 11.

CBL reported in March that it expects to eliminate more than $1.6 billion of debt under its bankruptcy restructuring plan.

CBL and 176 affiliated companies filed for Chapter 11 bankruptcy on Nov. 1 and Nov. 2 in the U.S. Bankruptcy Court for the Southern District of Texas, Houston Division.

Talen higher

Talen’s 6½% senior notes due 2025 (Caa1/CCC/B-) rose 1 3/8 points to 55 3/8 bid on $2.5 million of secondary supply Monday, a source said.

The Woodlands, Tex., and Allentown, Pa.-based power company’s 10½% senior notes due 2026 (Caa1/CCC/B) climbed 3 5/8 points to 60 bid during the session after gaining 7/8 point on Friday.

Secondary volume was on the lighter side with $2 million of paper traded.

Distressed returns up

Distressed index returns remain in the negative so far in the month and quarter.

The S&P U.S. High Yield Corporate Distressed Bond index’s one-day total returns on Friday fell to minus 0.44% from 0.12% on Thursday, minus 0.1% on Wednesday and 0.08% on Tuesday.

Month-to-date total returns grew to minus 0.52% on Friday from minus 0.08% on Thursday, 0.2% on Wednesday and minus 0.1% on Tuesday.

Year-to-date total returns declined to 29.55% as the week closed versus 30.12% on Thursday, 29.97% on Wednesday and 30.1% at the start of the holiday-shortened week.

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