Hertz’s new issue spurs uptick in secondary market; Atwood active, unchanged; oil goes low

By Colin Hanner and Paul A. Harris

Chicago, May 31 – The high-yield market welcomed a new issuance from Hertz Corp. on Wednesday, which caused up upsurge in activity in the secondary market for the car sales and rental company’s existing bonds.

An expected offering of five-year second-lien notes for Hertz was upsized to $1.25 billion on Wednesday afternoon, and existing issuances were up more than 1 point across the board, market sources said.

Offshore drilling contractor Atwood Oceanics, Inc. remained active a day following a takeover from Ensco plc, which acquired the Houston-based offshore drilling contractor for $839 million in an all-stock transaction, the companies said in a news release on Tuesday.

Atwood’s bonds, however, were nearly unchanged, while Ensco’s bonds were down a round number.

The downturn in oil continued into Wednesday, though steeper losses plagued crude oil futures. Noble Holdings International Ltd. was lower, as was California Resources Corp.

In the recently-priced realm, pet retailer PetSmart Inc.’s $2 billion of eight-year notes in two tranches moved up and down marginally, and Consolidated Energy Ltd. bounced slightly higher.

Franklin, Tenn.-based hospital group, Community Health Systems, Inc., which divested five hospitals after the close on Tuesday, was down fractionally in one of its issues, a market source said. Other hospital groups saw some activity, though movement did not stretch far in either direction.

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