Lumen bonds see strong pickup; Bausch Health mostly lower; Altice’s CSC notes mixed

By Cristal Cody

Tupelo, Miss., Sept. 20 – Lumen Technologies, Inc.’s notes were mixed in light trading on Wednesday as the company faces a slew of issues, including a class-action lawsuit filed at the week’s start.

Lumen’s 7.6% senior notes due 2039 rallied 2½ points as one of the day’s biggest distressed gainers.

Also Wednesday, Lumen’s 4% senior secured notes due 2027 moved down more than ¼ point to a 68 bid handle on $3 million of volume.

Bausch Health Cos. Inc.’s paper was mixed but saw some of the biggest losses over the session, a source reported.

The company’s notes were mixed but mostly down around ¾ point to about 1¼ points.

The issuer that was at the top of the attention-getters in fairly quiet distressed secondary action on Wednesday was Altice USA, Inc. subsidiary CSC Holdings, LLC, a source said.

The company’s notes were mixed and seen down about ½ point in the most active issue to ¼ point to ½ point better in other tranches.

The most active issue was the 5¾% senior notes due 2030, which were down about ½ point on more than $10 million of paper traded on Wednesday.

Volatility climbed over the day following the Federal Reserve’s rate decision on Wednesday,

The Federal Reserve said following its two-day meeting on Wednesday that it would leave the target range for the Federal Funds rate unchanged at 5¼% to 5½%,

Some sources report they are eyeing a potential hike at the Fed’s November monetary policy meeting.

The chances for a recession starting within the next 12 months has moderated since the start of the year but remains high at 30% to 35%, according to a S&P Global Ratings note on Wednesday.

The CBOE Volatility index climbed 7.3% to 15.14.

The Nasdaq closed down 1.53%.

The iShares iBoxx High Yield Corporate Bond ETF fell 6 cents, or 0.08%, to $74.40.

Lumen notes mixed

Lumen Technologies’ 7.6% senior notes due 2039 (Caa3/CCC-) rallied 2½ points to around 34 bid on $3.5 million of trading action on Wednesday, a source said.

The notes were among the day’s biggest gainers in the distressed and junk spaces.

The yield was 23.67%.

Also Wednesday, Lumen’s 4% senior secured notes due 2027 (Caa2/B) moved down more than ¼ point to a 68 bid handle on $3 million of volume.

Lumen’s 4½% senior notes due 2029 (Caa3/CCC-) were little changed on a 32 bid handle in light trading totaling $1.5 million during the session.

On Monday, the company was reportedly the subject of complaints in a lawsuit over the risks to its lead-covered cable infrastructure.

Lumen reported last week that a bondholder group formed to discuss refinancing options and its covenant compliance for the proceeds from the sale of its Latin American business has no evidence to support its claims.

Lumen reported heavy second-quarter losses of $8.74 billion in August.

The Denver-based telecommunications company’s stock (NYSE: LUMN) was flat on Wednesday at $1.63.

Bausch paper declines

Bausch Health Americas, Inc.’s 8½% senior notes due 2027 (Ca/CCC-) fell around 1¼ points to a 52 bid handle and a 32.53% yield on $3.13 million of trading on Wednesday, a source said.

Bausch Health Cos.’ 5¾% senior secured notes due 2027 (Caa1/CCC+/B) declined ¾ point to 61½ bid and a 20.58% yield on $5 million of secondary activity.

The 6 1/8% senior secured notes due 2027 (Caa1/CCC+/B) also slipped ¼ point by late afternoon to 64¾ bid on $3.8 million of volume.

Meanwhile, the 4 7/8% senior secured notes due 2028 (Caa1/CCC+/B) eked out some gains in steady trading totaling $4.6 million on Wednesday.

The issue was quoted up ¾ point at 59¼ bid. The yield was 18.13%.

Bausch’s 11% senior secured first-lien notes due 2028 (Caa1/CCC+/B) also added ¼ point to trade at 70¾ bid in light supply of $2 million.

On Monday, Bausch announced that its chief financial officer had resigned and a formal search for a replacement is underway.

The company intends to appoint an interim chief financial officer if a permanent replacement for current CFO Tom Vadaketh is not hired by his resignation date of Oct. 13.

Bausch is facing a securities class action lawsuit over alleged violations of federal securities laws as well as investor contention against its plans to spin off Bausch + Lomb Corp.

Bausch + Lomb was in the primary market in the prior week with a $1.4 billion offering of five-year senior secured notes.

The Laval, Quebec-based pharmaceutical company’s common stock (NYSE: BHC) shot up 8.03% on the day to $8.34 in heavy trading.

CSC bonds mixed

Altice USA subsidiary CSC Holdings’ notes were mixed in some of the day’s most active distressed paper traded on Wednesday, a source said.

CSC’s 5¾% senior notes due 2030 (Caa2/CCC+) declined about ½ point to a 58 bid handle on $10.87 million of volume.

The 4 5/8% senior notes due 2030 (Caa2/CCC+), meanwhile, were up ½ point at 56½ bid on $6 million of trading.

CSC’s 7½% senior notes due 2028 (Caa2/CCC+) also were up ¼ point at 68¼ bid on $1.75 million of supply.

Shares (NYSE: ATUS) of the New York-based broadband communications provider’s parent company, Altice, rose 2.73% to $3.38 in thin trading.

Distressed returns down

S&P U.S. High Yield Corporate Distressed Bond index one-day total returns declined on Tuesday to minus 0.17% from 0.05% on Monday.

Month-to-date total returns slipped to 1.62% on Tuesday versus 1.8% at the start of the week.

Year-to-date distressed total returns fell to 19.02%, compared to 19.23% on Monday.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.