Rite Aid, Sensata price deals; Guitar Center gains; Transocean off; funds lose $1 billion

By Paul A. Harris and Paul Deckelman

New York, March 19 – Rite Aid Corp. came to market on Thursday with a $1.8 billion offering of eight-year notes, and the No. 3 U.S. drugstore chain’s new issue proved to be a pleasant tonic for the high-yield market, with traders seeing the new bonds firming solidly in heavy trading.

Sensata Technologies BV also did a new deal during the session, a $700 million drive-by offering of 10.5-year notes. While there was brisk aftermarket activity in the electronic components maker’s issue, it rose only slightly.

In an uncommon transaction for a domestic issuer, chemical maker Huntsman Corp. priced a 10-year offering of euro-denominated notes.

Wednesday’s new deal from Infor (US) Inc. was seen having moved up.

Away from the new deals, Guitar Center Inc.’s bonds firmed smartly after the musical instrument retailer reported its earnings.

But offshore energy driller Transocean Inc.’s bonds were lower in active dealings after Standard & Poor’s cut its debt ratings to junk, several weeks after Moody’s Investors Service did likewise.

Statistical indicators of junk market performance were mixed for a second consecutive session.

But another numerical market barometer – flows of cash into and out of high-yield mutual funds and exchange-traded funds, considered a reliable guide to overall Junkbondland liquidity trends – saw a second consecutive big downturn in the latest reporting week.

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