Babcock & Wilcox: Preferreds And Baby Bonds Saved From The Brink By AI

2025-11-17 10:25:20 ET

The AI-driven boom in energy demand is extending the life of coal-fired power plants across the U.S. as new combined-cycle power plants also look set to come online either a new ground-up developments or coal-to-gas conversions to provide Babcock & Wilcox ( BW ) with a remarkable salvo from financials that had placed operations on the brink. The stakes were high, with the company's 7.75% Series A Preferred Shares ( BW.PR.A ) having dropped to as low as 9 cents on the dollar. The 6.50% Senior Notes Due 2026 ( BWNB ) and the 8.125% Senior Notes Due 2026 ( BWSN ) both dropped to as low as 30 cents on the dollar. To highlight just how critical the situation had become, the bonds come due for repayment next year, with the discount reflecting extreme market disbelief that BW could make whole its bondholders. To be clear, the market had priced these for a BW Chapter 11 filing occurring in the near-term....

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