Frontier remains busy, ends lower; Intelsat gains amid hopeful merger buzz; Valeant better on redemption

By Stephanie N. Rotondo

Seattle, July 13 – A distressed debt trader said that Frontier Communications Inc. and Intelsat SA were Thursday’s notable names.

There was no specific reason that Frontier was notable, aside from the fact that, as has been the case of late, it was actively traded.

The paper was also lower on the day, after managing to hold steady on Wednesday.

“They were very active again and down a good bit,” a trader said, though he noted that there was some intraday recovery, which allowed the bonds to end better than their session lows.

The 11% notes due 2025 were “still down about a point on the day,” the trader said.

He pegged the notes at 88½ at day’s end. That was a point better than the intraday low.

Another trader said there was “good volume” in the 11% notes, which he saw at 88½ as well.

He called that down “almost a point.”

The trader also saw the 6¼% notes due 2021 slipping to 84¼, while the 8¾% notes due 2022 waned a point to 85 7/8.

As for Intelsat, its bonds were better on the day on chatter the company’s recently failed merger with OneWeb LLC could be revived.

Meanwhile, Valeant Pharmaceuticals International Inc.’s debt was getting a small boost on word the company planned to redeem its $500 million outstanding 6¾% notes due 2019.

A trader said the 5 7/8% notes due 2023 were “a shade higher” at 86, while the 6 1/8% notes due 2015 ticked up a quarter-point to 85¼.

The company will use cash on hand to fund the redemption that will occur on Aug. 15. Once completed, Valeant will have reduced its debt by more than $4.8 billion since the end of the first quarter of 2016.

Intelsat rises

Intelsat paper got a boost on Thursday on reports that holders of the “LuxCo” bonds were in talks to potentially try to revive the company’s failed merger with OneWeb.

A trader said the bonds were “higher on prospects that the deal could be revived.

However, “I think guys are getting a little ahead of themselves on that one,” the trader noted.

The trader said Luxco paper was up about 2 points on the day, while Intelsat Jackson Holdings SA debt firmed half a point to a point.

At another desk, a trader pegged the 7¾% notes due 2021 at 58, a gain of nearly 3 points.

On June 1, Intelsat announced that it had terminated an exchange offer, due to limited response. The exchange was being done in an effort to reduce its debt by about $3.6 billion.

But extending the offer three times and even adding a sweetener did little to compel investors to participate.

The termination of the exchange then led OneWeb and its parent company, SoftBank, to back out of the $14 billion merger.

© 2015 Prospect News.
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