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Junk bonds sold by indebted satellite operator Intelsat advanced for a second straight day on Tuesday as the group agreed to a conditional offer to merge with OneWeb in a deal backed by Japan’s SoftBank.
The merger, which contemplates reducing Intelsat’s debt burden by roughly $3.6bn and includes a $1.7bn investment from SoftBank, is conditional on bondholder sign off.
Intelsat’s debt ranked among the most heavily traded high-yield bonds on Tuesday, according to trading platform MarketAxess. The $2bn worth of bonds sold by the company’s Intelsat Luxembourg unit climbed 13 cents on Tuesday to trade hands at 57.5 cents on the dollar.
Debt issued by Intelsat Jackson in 2014 advanced to 93 cents on the dollar from 91 cents a day earlier and a low in January of 72 cents. Intelsat has offered to exchange the vast majority of its outstanding debt for new bonds, stock and cash as part of a merger with OneWeb.