Freeport-McMoRan, Boise Cascade price; Macy’s rises; Diebold pushes higher; Carnival positive

By James McCandless and Paul A. Harris

San Antonio, July 13 – The July 13 week got underway to a strong and steady news flow in the high-yield primary market, while the secondary space opened the week with a positive trend around top traders.

Two ultra-familiar high yield names came with drive-by deals.

Freeport-McMoRan Inc. priced an upsized $1.5 billion amount of senior notes (expected ratings Ba1/BB) in two tranches.

And Boise Cascade Co. priced a $400 million issue of 10-year senior notes (Ba2/BB-) at par to yield 4 7/8%.

In the secondary, Macy’s, Inc.’s notes were on the rise after a subsidiary announced the early results and extensions for its exchange offers.

Meanwhile, Diebold Nixdorf, Inc.’s recent issues pushed higher in the second full trading day since pricing last week.

In the travel space, Carnival Corp. & plc and Royal Caribbean Cruises Ltd.’s paper was positive.

Housewares marketer Tupperware Brands Corp.’s notes picked up steam as it receives a ratings upgrade.

Macy’s rises

At the top of the secondary, Macy’s notes were on the rise, traders said.

The 8 3/8% senior secured notes due 2025 gained ¾ point to close at 101½ bid.

By the end of the session, about $28 million changed hands.

Before the market open on Monday, the New York-based department store chain’s subsidiary, Macy’s Retail Holdings, Inc., announced the early results and extensions for its exchange offers and consent solicitations for six series of its debentures.

The company is offering to exchange the debentures for new notes with the same coupon and tenor as the existing debentures.

Concurrently, the name is also offering a consent fee of $20 in cash per $1,000 principal amount to holders who deliver their consents by the consent expiration date, 11:59 p.m. ET on July 24.

Diebold higher

Meanwhile, Diebold’s recently priced issues were pushed higher, market sources said.

The 9 3/8% senior secured notes due 2025 improved by ¼ point to close at 102¼ bid.

About $14 million of the notes were exchanged.

The North Canton, Ohio-based connected commerce company’s structure continued to receive attention after bringing the two new tranches of five-year senior secured notes to market last week.

Those notes were priced on Thursday while Diebold Nixdorf Dutch Holding BV priced €350 million of 9% notes to yield 9 1/8%.

“Everything looked better today, so these firmed up,” a trader said.

The name’s more established 8½% senior notes due 2024 improved ¾ point to close at 85½ bid.

Carnival, Royal Caribbean up

In the travel space, seafaring name Carnival’s paper was positive, traders said.

The 11½% paper due 2023 garnered ¾ point to close at 109½ bid. The 6.65% debentures due 2028 picked up ¾ point to close at 77 bid.

About $21 million of the 11½% paper was on the tape.

During the Monday session, the Miami-based cruise company’s structure followed the market’s positive streak despite negative headlines about a resurgence in coronavirus cases and analyst downgrades.

Increased prevalence of cases in parts of the U.S. has led some states to roll back reopening measures.

“It’s a question of where we will be in terms of cases by the time they want to get back to normal again,” a trader said. “The stock was hammered, but the bonds were swept up in the positive wave.”

Also, analysts at Bank of America and Wedbush both cut their targets for the stock after the company announced that its German subsidiary would resume operations in August.

North American operations are still paused through Sept. 30.

Miami-based sector peer Royal Caribbean’s notes also gained ground.

The 9 1/8% senior notes due 2023 tacked on ½ point to close at 101½ bid.

Tupperware adds

Household products name Tupperware’s issues picked up steam, market sources said.

The 4¾% senior notes due 2021 shot up 4 points to close at 70½ bid.

The Orlando, Fla.-based marketer of housewares’ structure saw positivity after receiving a ratings upgrade from S&P.

The agency lifted the company’s issuer rating to CCC- from SD while keeping the rest of its ratings at D.

S&P said that it upgraded the name after it completed a tender offer for about $97.6 million of its $600 million of senior unsecured notes.

The outlook is developing.

Indexes mixed

Two high yield indexes kicked off the week diverging in direction.

The KDP High Yield Daily index rose 7 basis points on Monday, capping the day at 65.45 with the yield holding steady at 6.49%.

The index lost 6 bps on Friday, shaved off 2 bps on Thursday and was up 2 bps on Wednesday.

The ICE BofAML US High Yield index gained 39 bps with the year-to-date return finishing at negative 3.353%.

The index was down 6.8 bps on Friday, 14.36 bps on Thursday and 5.6 bps on Wednesday.

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