PG&E dips as further mediation ordered; Endo notes gain amid executive appointments

By James McCandless

San Antonio, Feb. 19 – Wednesday’s session in the distressed debt space saw heightened attention paid to utilities and pharma names.

PG&E Corp.’s notes dipped after the company was ordered by a bankruptcy court to participate in further Chapter 11 plan mediation.

Pharma name Endo International plc’s issues gained as the company named a new chief executive officer late in the day.

Sector peer Mallinckrodt plc’s paper also pushed higher.

Meanwhile, shipping company Navios Maritime Holdings Inc.’s notes improved after reporting fourth-quarter earnings.

Oilfield services name Superior Energy Services, Inc.’s issues varied as the company again extended an exchange offer.

Lifted oil futures begot similar rises for Antero Resources Corp.’s and EQT Corp.’s paper while Whiting Petroleum Corp.’s notes diverged.

Elsewhere, in the telecom space, Intelsat SA’s issues made strides by the close.

PG&E dips

PG&E’s notes dipped during Wednesday’s activity, traders said.

The 6.05% notes due 2034 lost 1¾ points to close at 113¼ bid.

In a bankruptcy court filing on Tuesday, the San Francisco-based bankrupt electric utility was ordered to participate in further Chapter 11 plan mediation, Prospect News reported.

The mediation would tackle a dispute over $2.7 billion in claims filed by the California Governor’s Office of Emergency Services, an objection filed by the TCC to $3.9 billion in claims filed by the Department of Homeland Security/Federal Emergency Management Agency and a dispute related to an extension of the claims filing deadline for some creditors.

Also on Tuesday, the company reported lukewarm fourth-quarter earnings.

The utility showed a 68 cents per share profit, shy of the 77 cents per share profit that analysts predicted.

PG&E also said that it would spend $37 billion to $41 billion to improve its equipment standards and that it would exit bankruptcy by June 30.

Endo, Mallinckrodt gain

Pharmaceuticals name Endo’s issues gained throughout the day, market sources said.

The 6% senior notes due 2025 picked up 1 point to close at 77 bid. The 6% senior notes due 2023 gained 1¼ points to close at 82 bid.

The Dublin-based generic drug producer’s structure saw heightened activity in the run-up to the after-market announcement that it has named Blaise Coleman as its new president and CEO.

Coleman was previously the company’s executive vice president and chief financial officer.

“There was an uptick in that paper today,” a trader said. “They’ve been on a positive run for the last few months.”

The company’s issues have bounced off of October’s lows, largely due to a high-profile settlement with Oklahoma over opioid-related litigation.

Dublin-based sector peer Mallinckrodt’s paper also pushed higher.

The 5¾% senior paper due 2022 jumped up 4¼ points to close at 58¾ bid. The 5½% senior paper due 2025 added 1½ points to close at 43 bid.

Navios up

Meanwhile, shipping name Navios’ notes improved, traders said.

The 11¼% senior secured notes due 2022 improved by 2¼ points to close at 72¾ bid.

On Wednesday morning, the Monaco-based shipping company put out its fourth-quarter and end of year report.

Navios reported a profit of $1.44 per share.

Revenues for the quarter came in at $118.9 million while whole year revenues were $482.4 million.

Navios also said that it liquidated Navios Europe Inc., acquired two vessels, delivered two vessels and sold three vessels.

Superior Energy varies

Oil and gas name Superior Energy’s issues varied in direction, market sources said.

The 7 1/8% senior notes due 2021 shaved off ½ point to close at 83½ bid. The 7¾% senior notes due 2024 garnered 3 points to close at 61 bid.

The Houston-based oilfield services provider announced on Wednesday that wholly owned subsidiary SESI, LLC again extended the expiration time of its exchange offer on $635 million of its $800 million outstanding 7 1/8% senior notes due 2021 for $635 million of new 7 1/8% senior notes due 2021, Prospect News reported.

The offer was set to expire at 5 p.m. ET on Feb. 19 after previous deadlines of Feb. 18 and Feb. 13.

As of the previous expiration, holders had tendered $617.89 million, or 77.24%, of the notes.

Oil futures better

Oil futures were lifted, which gave way for similar rises from distressed energy names, traders said.

West Texas Intermediate crude oil futures for March delivery rose $1.24 to settle at $53.29 per barrel.

North Sea Brent crude oil futures for April delivery finished at $59.12 per barrel after a $1.37 gain.

Denver-based independent oil and gas producer Antero Resources’ paper saw positivity.

The 5 5/8% senior notes due 2023 tacked on 1 point to close at 64½ bid. The 5% senior paper due 2025 shifted up 1 point to close at 60½ bid.

Pittsburgh-based producer EQT’s notes followed the sector trend.

The 3.9% senior notes due 2027 rose ¾ point to close at 71¾ bid.

Whiting Petroleum, another Denver-based producer, saw mixed results for its issues.

The 6¼% senior notes due 2023 lost 1½ points to close at 57½ bid. The 6 5/8% senior notes due 2026 improved by 1¼ points to close at 50¼ bid.

Intelsat rises

Elsewhere, in the telecom space, Intelsat’s paper made strides, market sources said.

Intelsat Luxembourg SA’s 8 1/8% senior notes due 2023 picked up 2 points to close at 44½ bid. The 9½% senior notes due 2023 gained 2 points to close at 65½ bid.

Over the last two trading days, the Luxembourg-based satellite operator’s structure has seen spikes after hedge fund Appaloosa Management disclosed a 2.1% stake that it recently purchased.

The fund’s manager, David Tepper, pushed for the company to file for Chapter 11 bankruptcy in order to renegotiate the terms of its revenue agreement with the Federal Communications Commission.

In a letter to the board of directors, Tepper said that the current plan that would net around $4.85 billion is unfair.

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