Concordia Healthcare Corp. T.CXR.R

2023 Bond up to $70 yld 14% This morn

[cg16]

Opposite to the SP again..

[Craigbad]

The bonds wouldn't be a bad play IF you were of the opinion they could get a cash injection. If they were going to retire some debt there is some fast upside there from where they're to trading face value. If I was crazy enough to be long anything on this name it would be the secured bonds. I think the equity will be worthless.

[smallshort]

If you think this company can survive all it's dealing with Private Equity, often referred to as Pirate Equity, sell your shares and buy the bonds.   The bonds are secured but with a Caa rating, they are near junk status. Caa rating is ""speculative and risky" and given the debt here and the complete lack of market confidence with all we know as facts today, don't be

[cg16]

But with all the risk that keeps "increasing" why has the bonds moved up? They were $63.50 and 16+% yield last week and this week they are $70 and 14% yld? If they are moving to junk, shouldn't the price and yld be moving the other way? 

[Craigbad]

IF you believe they will pull off a deal by the end of the month AND you think the cash will be used to pay down debt thats a pretty sweet return for the bonds to be bought at face value. The bonds are a much better play regardless as you will get something if the lights go out. If you buy the bonds at $70 and the pipedream comes true you get over $100. If you own shares, they'll be dilluted

[cg16]

So is it correct to say that the bond action right now is opposite to the short thesis? 

[Craigbad]

Its speculation they might get a deal done. I was trying to figure the math out. I would go long the bonds for a 43% return in a month or two if the math worked. It just makes no sense for PE to pay me $100 for something they can buy for $70 in the public market to be nice and retire some debt for the company. If the market truly believed they would get a deal done and the money would buyout the

[Lumberfeverlong]

Bonds are moving up becuase the market anticipates a transaction that will lower debt substantially which means bonds will be retired via proceeds of a capital raise closer to their face value.  That capital raise will likely involve convertible preferreds at a much lower yield than the higher cost bonds.  There might also be a common share component to it upfront, but not one that will

[Craigbad]

My bet is the headwinds are far worse than expected and the company will be desparate for cash. If they don't get, I think the $50 shareprice you predicted last month will be $49 less than you thought it would be. Nothing else makes mathematical sense to me. Again, show some numbers on how a deal would work for Pirate Equity, the company and common shareholders. Its baffling. 

[smallshort]

At 70 cents on the dollar, the bonds are still very scary.   I would actually be buying the bonds here but the real assets really aren't strong enough. You might get "something" but it might be a lot less than 70 cents on the dollar. Do you think bonds of Enron were worth much? I do agree that the bonds are a much better speculative investment that the common shares being