Endo notes see unexplained spike in volume; PetSmart mixed a day after hiring advisers

By James McCandless

San Antonio, June 7 – The distressed debt market experienced another day of lackluster activity on Thursday, traders reported.

Endo International plc notes spiked in trading, though market sources were unsure of the cause.

PetSmart, Inc. issues were mixed a day after the company hired advisers to help contain and reduce its $8 billion in debt.

Murray Energy Corp. paper declined, reversing some gains made since Monday’s announcement of a debt restructuring agreement made with portions of its noteholders and lenders.

Intelsat SA notes gained. Recently, the company posted subpar results in its Q1 report. Frontier Communications Corp. issues were mixed. The company recently presided over a failed auction for its Florida assets. Bristow Group Inc. paper rose.

Endo International spikes

Dublin-based pharmaceutical name Endo International’s notes saw an increase in volume, traders confirmed. Other than being a respite in a sea of inactivity, there was no confirmed news driving trading.

“These notes were on top today but nobody knows why,” a trader said. “It may be nothing, but I suspect something might come out in the next day or so.”

The 6% notes due 2023 rose about 4 points to close at 79¾ bid. The 6% notes due 2025 gained about 3 points to close at around 76¾ bid.

PetSmart mixed

Phoenix-based pet supplies retailer PetSmart issues were mixed, market sources confirmed, after Wednesday’s announcement that the company has hired investment bank Houlihan Lockey, Inc. as restructuring advisers. The firm will work on solutions for reducing the company’s $8 billion in debt.

On Tuesday, the company spurned its debt investors by moving 36.5% of its stake in fast-growing e-commerce segment Chewy.com to its private equity owner BC Partners and an unrestricted subsidiary. The site was purchased last year for $3.35 billion, partially financed with $2 billion of debt.

The 5 7/8% notes due 2025 were level at 75¾ bid. The 8 7/8% notes due 2025 shaved off ¼ point to close at 57¾ bid.

On Wednesday, the 5 7/8% notes rose about 1¾ points and the 8 7/8% notes traded up 3 points.

Murray Energy down

St. Clairsville, Ohio-based coal producer Murray Energy paper declined, traders confirmed, after days of rising. On Monday, the company made an agreement with a portion of its noteholders and bank lenders on a debt restructuring plan that will refinance its 11¼% senior secured notes due 2021 and its term loans.

Holders of 71% of the 11¼% notes and 61% of the term loans have entered into a transaction support agreement with the company to participate in the refinancing.

The 11¼% paper due 2021 lost 1¼ points to close at 58 bid.

On Wednesday, the 11¼% paper rose about 2½ points.

Volume names trade

Luxembourg-based satellite communications company Intelsat notes gained. A recent Q1 report showed a 56 cents per share loss, missing analyst estimates of 41 cents per share.

The Intelsat (Luxembourg) SA 7¾% notes due 2021 rose about ¾ point to close at 85¼ bid. The 8 1/8% notes due 2023 gained about ¼ point to close at 79¾ bid.

Norwalk, Conn.-based wireline name Frontier Communications issues were mixed. A recent failed auction for the company’s Florida assets has hampered investor confidence.

The 7 5/8% notes due 2024 were level at 69¼ bid. The 10½% notes due 2022 gained about ¼ point to close at around 90¾ bid. The 11% notes due 2025 jumped up 1¾ points to close at 82¾ bid.

Houston-based offshore energy aviation services name Bristow Group saw its 6¼ % paper due 2022 gained about ¾ point to close at around 77¾ bid.

“Today wasn’t different from the other days this week,” a trader said. “It’s just been a dead week. I would think tomorrow would be true barring any major news.

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