Golden Nugget strengthens on liquidity spike, despite depleting revenue; Antero rises on tender offer results and Dutch auction offer announcement — Mid-Day Commentary

Golden Nugget’s bonds rose today following the gaming company’s recent disclosure of a robust cash position even after revenue fell 67% in 2Q20.  

As Debtwire reported yesterday, the gaming company listed a USD 411m cash balance at the end of 2Q20, up from USD 224m at the end of 1Q20. The company is also working to spin off its i-gaming subsidiary into a SPAC called Landcadia Holdings II. Proceeds would be used to pay down a portion of its term loan due 2024.

Meanwhile, total revenue for Golden Nugget was USD 288m in 2Q20, down from USD 860m in 2Q19.

Golden Nugget’s USD 670m 8.75% senior subordinated notes due 2025 traded as high as 71.25 to yield 17.466% yesterday (17 August), up from trades at 66.75 to yield 19.232% on 14 August before earnings. The notes softened a little today to trade at 70.5 to yield 17.755%, according to MarketAxess. 

The USD 1.3bn 6.75% senior unsecured notes due 2024 traded as high as 82 yesterday to yield 12.4%, up from 80, yielding 13% on 14 August, according to MarketAxess.

Antero Resources’s bonds traded up after the company announced tender results late yesterday for its 5.375% notes due 2021. The company also announced a Dutch auction offer for its 5.125% notes due 2022 and 5.625% notes due 2023. 

The company successfully tendered USD 191.6m of the 5.375% notes due 2021 for 98 cents on the dollar. On the other hand, the Dutch auction offer is capped at USD 250m. The offer is expected to expire on Tuesday, 8 September at 11:59pm ET. 

Antero’s USD 706m 5.625% senior unsecured notes due 2023 last traded today at 80 to yield 14.625%, up from 77.5 to yield 15.934%, according to MarketAxess. 

The USD 600m 5% senior unsecured notes due 2025 last traded at 70 to yield 14.202% today, up from 68.5 to yield 14.771%. 

On the textbook front, loans issued by Cengage and McGraw-Hill moved down after Moody’s downgraded the companies’ corporate ratings several notches. 

The companies, which recently canceled merger plans, were both downgraded to Caa2 from B3, as they face secular pressures and transformation in the higher education market due to uncertainty around enrollment levels during the COVID-19 pandemic, the Moody’s ratings actions state. 

Cengage’s USD 1.71bn Libor+ 425bps term loan due 2023 was last quoted today in the 80.375/82.375 context, from trades yesterday at 81.854/81.021, according to Markit.

McGraw-Hill’s USD 1.575bn L+ 400bps term loan due 2022 was last quoted today in the 86.859/88.453 context, down from trades yesterday at 87.891/89.734, according to Markit.

Southwestern Energy’s debt ticked up after the company announced it is launching an offering of USD 350m senior notes due 2028.

Proceeds from the financing along with those from its recent common stock offering and borrowings under its credit agreement, will be used to redeem Montage Resource Corporation’s senior notes, which Southwest will assume after merging with Montage.

Its USD 639m 7.5% senior unsecured notes due 2026 changed hands at 100.462 this morning for a 7.348% yield compared to 98.532 on 17 August, according to MarketAxess.

2020 Debtwire

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