Frontier Communications falls amid bankruptcy worries; Denbury lower after ratings cut

By James McCandless

San Antonio, March 11 – More pressure hit the distressed debt market, with coronavirus fears continuing to weaken several sectors.

Frontier Communications Corp.’s notes fell a day after news reports indicated that the company would be forgoing a coupon payment.

The 10½% senior notes due 2022 shed 6 points to close at 37 bid. The 11% senior notes due 2025 dived 7 points to close at 36 bid.

The 10½% notes saw about $21 million trading by the end of the session.

On Tuesday, news broke that the Norwalk, Conn.-based wireline communicator is planning on forgoing a slate of March 15 coupon payments.

The company is in talks with creditors to file for Chapter 11 bankruptcy with a restructuring plan that would secure DIP financing and lead to a reduction in its debt.

In the energy space, Denbury Resources Inc.’s paper declined after receiving a ratings downgrade during the day.

The 7¾% notes due 2024 were docked 2¾ points to close at 32½ bid.

During the Wednesday session, Moody’s Investors Service issued ratings downgrades for the Houston-based independent oil and gas producer.

The agency lowered its corporate family rating, probability of default rating, speculative grade liquidity rating and issue level ratings.

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