Amazon’s Whole Foods acquisition sends grocery stores down; Hornbeck up on credit facility

By Colin Hanner

Chicago, June 16 – The surprising move by Amazon.com Inc. to purchase Whole Foods Market Inc. on Friday morning left grocery store retailers scrambling in all markets, including the distressed debt arena, a trader said.

On the day, though, less than $1.5 billion traded in the high-yield secondary market, a market source said.

Online retail behemoth Amazon purchased Whole Foods for $13.7 billion in what is seen as a move by Amazon to further fuse its e-commerce customer base with grocery shopping. On the day, other grocery store chains reacted poorly to the news, including Fresh Market, Inc., Tops Holding LLC and BI-LO LLC.

“That’s where most of the activity was today,” a trader said.

Distressed oil companies capped a rather tumultuous week in line with the price of crude oil, though Hornbeck Offshore Services, Inc., which provides offshore vessels to the industry, saw the biggest move of the day following the announcement of a refinanced credit facility.

Its bonds were up several points.

Intelsat SA revised its guidance following the longer-than-expected sales process of one of its services, causing a loss for several sets of notes, though the satellite telecommunications company did call $1.5 billion of its 7¼% notes, which traded close to par.

According to media reports, J. Crew Group Inc. met the 50% consent threshold needed from its term loan lenders to amend the term loan agreement.

Bonds were fractionally higher on small volume.

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