McDermott notes rise after forbearance news; U.S. Steel eyed as tariffs announced

By James McCandless

San Antonio, Dec. 2 – A new week in the distressed debt space started with attention paid to names in energy and manufacturing.

McDermott International, Inc.’s notes rose after announcing that it had entered into a forbearance agreement with some holders to access additional financing.

The 10 5/8% senior notes due 2024 gained ½ point to close at 7½ bid.

Early Monday, the Houston-based oil and gas engineering company announced that it entered into a forbearance agreement with the holders of more than 35% of its 10 5/8% senior notes due 2024 and was granted access to tranche B of its $1.7 billion super-priority senior secured credit facility, Prospect News reported.

The noteholders agreed to forbear from exercising any rights related to the interest payment due on Nov. 1, subject to certain conditions.

The company is in talks with additional creditors to potentially join the agreement in the coming days.

The forbearance period lasts until Jan. 15.

Manufacturer United States Steel Corp.’s notes varied as the U.S. government imposes steel tariffs on Argentina and Brazil.

The 6.65% senior notes due 2037 picked up ½ point to close at 78½ bid. The 6¼% senior notes due 2026 slid 1¾ points to close at 86¼ bid.

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