Diamond Sports secured notes decline; Telesat slides; China’s Shimao, Kaisa trade up

By Cristal Cody

Tupelo, Miss., Jan. 10 – Diamond Sports Group LLC’s notes slid 2¾ points on Monday as the company continued to dominate secondary trading in the distressed market.

Diamond Sports’ paper has been among the most active issues in distressed trading in an otherwise mostly quiet start to the year, according to market sources.

Telesat Corp.’s 6½% senior notes due 2027 (Caa1/B) sank over 4 points during the session on more than $2 million of trading volume.

Overall market tone was mixed as the second week of the year kicked off.

The iShares iBoxx High Yield Corporate Bond ETF rose 7 cents to $85.94.

Oil prices remained soft after ending Friday lower.

West Texas Intermediate crude oil benchmark futures for February deliveries fell 67 cents to settle at $78.23 a barrel.

Meanwhile, China’s distressed property developer space saw a lift on Monday.

Shimao Group Holdings Ltd.’s notes rallied in light trading after selling off on Friday and following downgrades from Moody’s Investors Service and S&P Global Ratings.

Kaisa Group Holdings Ltd.’s 11.95% senior notes due 2023 (C//C) climbed nearly 2 points on Monday.

Kaisa announced in December that it defaulted on four bonds, including the 11.95% notes.

Default fears remain high in the space, which saw numerous defaults in late 2021 from issuers including China Evergrande Group, Fantasia Holdings Group Co. Ltd., Sinic Holdings (Group) Co. Ltd., China Properties Group Ltd., Modern Land (China) Co. Ltd. and Sunshine 100 China Holdings Ltd.

Diamond Sports declines

Diamond Sports’ 5 3/8% senior secured notes due 2026 (Caa1/CCC) remained heavily traded on Monday with more than $12 million of issues changing hands as the paper slid 2¾ points to 50¾ bid, a source said.

The notes had rallied 4¼ points by the last trade on Friday to finish ahead of the weekend at 53½ bid.

The issue is up about ¾ point since the end of the year.

The Chesapeake, Va.-based sports broadcast group entered into a multiple-year renewal of its distribution rights agreement with the National Hockey League in December.

Telesat notes drop

Telesat Canada LLC’s 6½% senior notes due 2027 (Caa1/B) slid more than 4 points during the session to 71 bid, a source said Monday.

Secondary volume totaled more than $2 million.

The notes are down more than 7 points since November.

The Ottawa-based satellite communications company announced in November that subsidiaries Telesat Canada and Loral Space & Communications Inc. completed a merger with the company now publicly traded on the Nasdaq and Toronto Stock Exchange under the ticker “TSAT.”

Telesat’s shares were down 1.29% at $28.31 on Monday.

Shimao trades higher

Shimao’s 4¾% senior notes due 2022 (B2/CCC+/BB) jumped to 53 bid in light trading on Monday, according to a market source.

The notes went out on Friday down 3 5/8 points at 45 3/8 bid on reports the company failed to make a debt payment.

The issue traded at the 70 bid area at the end of December.

The company’s 3.45% senior notes due 2031 (B2/CCC+/BB) also rallied to 38 bid during the session after trading 3 3/8 points lower to 34¾ bid on Friday.

On Monday, S&P dropped Shimao to B- from B+ and the senior notes to CCC+ from B, noting significant deterioration of the company’s liquidity that is “worse than we previously anticipated.”

Moody’s downgraded Shimao to B2 from Ba3, citing elevated liquidity risks, weakening access to funding and large near-term debt maturities due in 2022.

The Hong Kong-based holding company focused on property management, development and sales was dropped to pure junk in December by Fitch Ratings.

Kaisa notes up

Kaisa’s 11.95% senior notes due 2023 (C//C) traded nearly 2 points higher at just under 26 bid on Monday, a source said.

The notes attracted $1 million of secondary volume.

Kaisa’s issue has softened about ¾ point from where the paper was seen before the holidays.

The Shenzhen, China-based real estate developer reported in December that it did not make the payments on the 11.95% notes due 2023, as well as its 6½% notes due Dec. 7, 2021, 11.7% notes due 2025 and 11.65% notes due 2026.

Distressed returns soften

Distressed index returns softened over the first week of 2022.

The S&P U.S. High Yield Corporate Distressed Bond index’s one-day total return on Friday declined to minus 0.3% from minus 0.22% on Thursday, 0.09% on Wednesday, 0.6% on Tuesday and 0.38% on Monday.

Month- and year-to-date index returns fell to 0.55% from 0.86% on Thursday, 1.08% on Wednesday, 0.99% on Tuesday and 0.38% on Monday.

© 2015 Prospect News.
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