Bed Bath & Beyond falls after interest payment; QVC downtrend continues; Bausch better

By Abigail W. Adams

Portland, Me., March 6 – The distressed debt space saw a quiet start to the week with volume light and no clear theme to the names that did trade.

The broader market launched the week with gains with the S&P U.S. High Yield Corporate Distressed Bond index adding 0.74% during Monday’s session.

Bausch Health Cos. Inc.’s senior notes were nominally improved in active trading on a strong day for the distressed debt space.

However, several retail names were under pressure with QVC Inc.’s senior notes continuing their downtrend following earnings from parent company Qurate Retail Inc. the previous week.

Rite Aid Corp.’s 8% senior secured notes due 2026 (Caa3/CCC-/CCC) were also off by almost 1 point.

Bed Bath & Beyond Inc.’s 4.915% senior notes due 2034 (C/C) fell in light volume after the company made its missed interest payment.

Bausch improves

Bausch’s senior notes improved in active trading as the broader distressed debt space continued to log gains.

Bausch’s 4 7/8% senior secured notes due 2028 (Caa1/CCC+) gained ¼ point to close the session at 62½, according to a market source.

The yield was 15 5/8%.

There was $9 million in reported volume.

Bausch’s 9¼% senior notes due 2026 (Ca/CCC-) rose 5/8 point to close the session at 76¾.

The yield was just shy of 19¾%.

There was about $5 million in reported volume.

QVC downtrend continues

QVC’s senior notes continued the downtrend sparked by disappointing earnings from parent company Qurate the previous week.

QVC’s 4¾% senior secured notes due 2027 (Ba3/B+) fell ½ point to close Monday wrapped around 55.

The yield was about 22 5/8%.

QVC’s 5.45% senior secured notes due 2034 (Ba3/B+) were down 1¼ points to close the day at 45½.

The yield was just shy of 16%.

The 4.45% senior secured notes due 2025 (Ba3/B+) fell 1 point to close at 75½.

QVC’s senior notes have been on a strong downtrend since Qurate reported disappointing earnings the previous week.

The 5.45% notes have fallen almost 7 points since Qurate reported earnings on March 1.

Rite Aid lower

While the broader distressed debt space remained strong on Monday, retail names remained under pressure with investors wary of the sector amid continued recession concerns.

Rite Aid’s 8% senior secured notes due 2026 shed almost 1 point in light volume, a source said.

The notes fell to a 52-handle and closed the day wrapped around 52¼.

The yield rose to 30 3/8%.

Bed Bath & Beyond lower

Bed Bath & Beyond’s 4.915% senior notes due 2034 fell in light volume despite a rating upgrade after the company made its missed interest payments.

The 4.915% notes continued to see small prints in the 13 range.

However, the only round lot print in the notes was 2½ points lower at 10½, according to a market source.

The 4.915% notes traded as low as 3 in late January with the market widely expecting a bankruptcy filing.

However, the company secured surprise financing via a convertible preferred stock and warrant offering, enabling it to make the $25 million missed interest payment on its secured debt.

The 4.915% notes jumped more than 10 points following the surprise capital raise with some playing the notes for the interest payment, sources said.

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