Uniti climbs as litigation settlement reached; GTT declines after posting Q4 loss

By James McCandless

San Antonio, March 2 – The market, including distressed tranches, seemed back to normal as last week’s significant losses were partially erased by a recovery.

Uniti Group Inc.’s notes climbed after the company announced a settlement to end its litigation with Windstream Holdings, Inc.

Meanwhile, in telecom, GTT Communications Inc.’s issues declined in reaction to the company’s weak Q4 earnings report.

Sector peer Intelsat SA’s paper varied a weekend after the Federal Communications Commission solidified rules for a C-band spectrum auction.

In oil and gas, Gulfport Energy Corp.’s notes moved higher in the face of a ratings downgrade and a spat with a hedge fund over board seats.

As crude futures snapped a losing streak, Range Resources Corp.’s, Whiting Petroleum Corp.’s and Chesapeake Energy Corp.’s issues responded in kind.

Elsewhere, in utilities, PG&E Corp.’s paper tracked higher as the company agreed to an amended Chapter 11 plan.

Pharmaceuticals producer Endo International plc’s notes were also seen rising throughout the day.

Uniti climbs

Uniti’s notes climbed at the top of the Monday session, traders said.

The 7 7/8% senior secured notes due 2025 picked up 2½ points to close at 106 bid. The 8¼% senior notes due 2023 rose 4 points to close at 97 bid.

By the close, the two tranches combined to see about $55 million changing hands.

On Monday morning, the Little Rock, Ark.-based real estate investment trust reached a settlement with large customer and telecom name Windstream, Prospect News reported.

As part of the agreement, the company will invest up to $1.75 billion in growth capital improvements, consisting of long-term fiber and related assets in certain Windstream ILEC and CLEC properties over the initial term of new leases.

A year after the first investment, the annual base rent payable by Windstream will increase by an amount equal to 8% of the new investment, subject to a 0.5% annual escalator.

The settlement is subject to approval in bankruptcy court.

GTT declines

Meanwhile, in the telecom space, GTT’s issues saw a decline, market sources said.

The 7 7/8% senior notes due 2024 shaved off ½ point to close at 76¼ bid.

Early Monday, the McLean, Va.-based cloud networking name released a weak fourth-quarter earnings report.

The company reported a 21 cents per share loss, on target with what analysts predicted.

Revenues came in at $423.9 million, just above analyst expectations.

“It was more active in the morning,” a trader said.

Also on Monday, the company announced that it amended its credit agreement to establish a $140 million term loan.

The term loan was incurred with an original issue discount of $5.6 million.

Intelsat varies

Sector peer Intelsat’s paper varied by the end of the day, traders said.

Intelsat (Luxembourg) SA’s 8 1/8% senior notes due 2023 dipped 1¼ points to close at 41 bid. The 9½% senior notes due 2023 tacked on 1 point to close at 60 bid.

The Luxembourg-based satellite operator’s structure continues to see heightened activity in the wake of the FCC’s Friday vote to establish terms of a C-band spectrum auction.

The move solidified the agency’s revenue outline, which designates $4.85 billion for Intelsat despite a months-long lobbying effort as part of a consortium of satellite names.

Recently disclosed large investor David Tepper, as part of the Appaloosa Management hedge fund, has advocated for a bankruptcy filing in order to negotiate for more revenue.

Gulfport higher

In oil and gas, Gulfport’s notes moved higher, market sources said.

The 6 3/8% senior notes due 2026 picked up 1¼ points to close at 37½ bid. The 6% senior notes due 2024 shot up 5 points to close at 38¼ bid.

During the Monday session, the Oklahoma City-based independent oil and gas producer received a slate of ratings downgrades from Moody’s Investors Service.

The agency downgraded the company’s corporate family rating, probability of default rating, senior unsecured notes rating and speculative grade liquidity rating.

The outlook remains negative.

Moody’s cited the rising financial risks amid low natural gas prices and limited hedging protection that will persist for the year.

Also on Monday, hedge fund Firefly Value Partners made two nominations to the board of directors, putting pressure on the company to improve its financial performance.

Crude better

As crude oil futures snapped a losing streak, distressed energy names were also lifted, traders said.

West Texas Intermediate crude oil futures for April delivery rose $1.99 to settle Monday at $46.75 per barrel.

North Sea Brent crude oil futures for May delivery finished at $51.90 per barrel after a $2.23 pickup.

Fort Worth-based producer Range Resources’ issues followed the trend.

The 4 7/8% senior notes due 2025 garnered 6¼ points to close at 68¼ bid. The 9¼% senior notes due 2026 tacked on 3¼ points to close at 71 bid.

Denver-based peer Whiting Petroleum’s paper shifted upward.

The 6¼% senior notes due 2023 gained ¾ point to close at 46 bid. The 6 6/8% senior paper due 2026 added 3¾ points to close at 40½ bid.

Oklahoma City-based producer Chesapeake Energy’s notes floated higher.

The 11½% notes due 2025 picked up 2½ points to close at 59¾ bid.

PG&E up

Elsewhere, in utilities, PG&E’s issues tracked higher, market sources said.

The 6.05% notes due 2034 inched up ¼ point to close at 114¼ bid.

The San Francisco-based bankrupt electric utility entered into amended and restated Chapter 11 plan backstop commitment letters.

The amendment extends the deadline for obtaining approval of the letters in bankruptcy court.

It also allows the debtors to implement the capital structure outlined in the reorganization plan so that the amount of the new equity financing component of the debtors’ capital structure would be $9 billion, and the capital structure will be deemed to include a $6 billion “tax benefits monetization transaction.”

Endo rises

Pharmaceuticals producer Endo’s paper was also seen rising, traders said.

The 6% senior notes due 2025 rose 1 point to close at 78 bid. The 6% senior paper due 2023 improved by 3½ points to close at 83 bid.

Recently, the Dublin-based drug maker’s structure has seen high volume in reaction to its latest earnings report and shifts in its executive makeup.

The company exceeded analyst estimates with a 74 cents per share profit and $764.8 million in revenue.

It also appointed company executive Blaise Coleman to fill the chief executive officer position.

© 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.