Good day and welcome to WSJ Pro Bankruptcy's Daily Briefing. It's Wednesday, Aug. 3. Revlon believers drove up its stock price again, notwithstanding the new debt it just took on. A Los Angeles mall is emerging from bankruptcy at a time when brick and mortar is going strong.

In international news, developing nations are turning to bank loans after losing access to bond markets. Lukoil launched a buyback of its dollar debt, citing Russian laws on paying foreign creditors. And the American Dream megamall in New Jersey continues to delay payments to bondholders.

Revlon shares double following bankruptcy loan. Shares of the beauty-products maker have more than doubled since it won court approval to take out $1.4 billion in financing to carry itself through bankruptcy. Stockholders typically walk away empty-handed in bankruptcies, but a run-up in Revlon shares after its bankruptcy filing in June has some wondering if it could be the next Hertz Global Holdings Inc., which paid out roughly $1 billion in equity value through its chapter 11 case last year.

The rally seemed to ignore that Revlon’s new loan puts additional debt on the company that must be repaid ahead of equity.

Los Angeles shopping center shows strength of bricks-and-mortar retail. For more than a year, the Plaza Mexico shopping center outside downtown Los Angeles operated under bankruptcy-court protection. But on a recent Sunday, families flocked to the 400,000-square-foot shopping center.

High foot traffic at shopping centers like Plaza Mexico has been a pleasant surprise in the retail world as the U.S. emerges from the pandemic. People who previously relied on online shopping are returning to bricks-and-mortar locations, especially those that offer experiences not found on the Internet.

Low-income nations turn to risky bank loans. Kenya and Ghana, frozen out of global bond markets, are among the countries that have said they would instead borrow using syndicated loans, a type of direct lending from big commercial banks.

They join more than a dozen governments across Africa and the Middle East that have taken out syndicated loans worth about $13 billion this year through June, according to a Standard Chartered analysis, nearly double the $6.7 billion in the same period last year.

Syndicated loans, which are pooled among a group of lenders, were the dominant source of private foreign funding for emerging markets until the Latin American debt crisis of the 1980s. Burned by lengthy restructurings, banks stepped back from financing developing nations’ budgets as governments turned to bond markets for greater transparency and lower costs. Now, sky-high bond yields have made bank loans appear relatively cheap, even though they can get expensive, given their short tenor and floating rate.

Lukoil offers foreign bondholder buyback. Russian oil company Lukoil PJSC has offered to buy back dollar-denominated debt from foreign bondholders, hoping to avoid default.

New Russian laws require that companies obtain consent from the country's finance ministry to make foreign currency payments to investors in hostile countries like the U.S. Lukoil said Tuesday it isn't guaranteed that it can get such a license, and even if it receives one, it may not be able to pay the full amount outstanding to foreign investors, "which may cause a potential event of default."

The company added that it has sufficient cash to buy back all five outstanding dollar bonds it has targeted for repurchase and will individually negotiate with creditors over the buybacks. — Alexander Saeedy

Alex Jones can’t tell defamation jury he's bankrupt. A Texas state judge admonished conspiracist broadcaster Alex Jones that he can’t tell jurors he is bankrupt in a defamation trial brought by Sandy Hook victims' families.

While testifying during a trial that will establish how much he owes Sandy Hook families for spreading falsehoods about the 2012 massacre, Mr. Jones said if he hired more employees to read all of the emails his Infowars’ site receives “we’d go bankrupt which we are now.”

Mr. Jones, who hasn't filed personal bankruptcy, was testifying after putting Infowars’ parent company into chapter 11 last week. A lawyer representing Sandy Hook families told Travis County District Judge Maya Guerra Gamble that Mr. Jones’s statement violated a court-order and was intended to influence jurors who will be determining what damages, if any, he is to be liable for.

Judge Gamble told Mr. Jones and his lawyers outside the presence of the jury that he cannot testify that he is bankrupt and that she would consider potential sanctions after the trial. “You must tell the truth while you testify, this is not your show,” the judge said. — Jonathan Randles

Delivery software firm GetSwift files for bankruptcy. GetSwift Inc., a company with operations in New York City that provides delivery and workforce management software, filed for bankruptcy Tuesday, with a deal to sell all of its assets to an affiliate of Stage Equity Partners LLC.

The company has obtained a $1 million loan from Galactic Ventures LLC, which has agreed to finance Stage Equity's deal to buy GetSwift's assets, according to papers filed by its co-founder Joel Macdonald in the U.S. Bankruptcy Court in New York.

GetSwift's parent company was founded in 2015 in Australia, and went public in 2016, raising $100 million from the capital markets. The capital raise fueled "explosive growth" until early 2021, according to Mr. Macdonald.

In 2018, GetSwift Ltd., an Australian subsidiary of GetSwift Technologies, which isn't part of the bankruptcy filing, was hit with class action lawsuits that drained resources and halted the company's growth trajectory, Mr. Macdonald also said. GetSwift Technologies' revenues totaled over $29 million for the nine months ended in March, according to another court filing. — Soma Biswas

Fed signals more rate rises coming. Federal Reserve officials said they expected to keep lifting borrowing costs through at least early next year to slow the economy and bring down high inflation, pushing back against some investors’ hopes of a milder rate path.

• Demand for workers fell in June. U.S. job openings fell to their lowest level in nine months and hiring slowed, in new signs of a cooling labor market. Despite the decline, total job openings remained well above the number of people unemployed but looking for work.

Market mayhem triggers deal-making drought. Merger activity has slowed dramatically after a record year in 2021, and some deal makers are bracing for an even quieter second half. Driving the decline is a lack of clarity about the direction of the economy and markets, as inflation rises and war rages in Ukraine. Higher interest rates have raised financing costs, while the end of a boom in deals involving special-purpose acquisition companies also has taken a toll on merger activity.

American Dream bondholders wait for state grant funding. Bondholders of the American Dream megamall in East Rutherford, N.J., have limited recourse after it missed an $8.7 million interest payment for $287 million municipal grant revenue bonds issued in 2017.

An American Dream spokesperson said that bondholders are supposed to be paid through the sales tax funds generated from the shopping mall, subject to state appropriation of up to 75% of those collected funds.

“We have no financial obligation to make any payments to the bondholders," the American Dream spokesperson said, adding that it made all necessary submissions to the New Jersey Economic Development Authority to release the grant funding. The state authority didn't return a request for comment on Tuesday.

Bond trustee U.S. Bank NA has notified bondholders that the interest payment due Monday wasn't made because only about $860 was left in the bonds’ reserve after the February interest was paid from the account, and no additional deposit came in. But the failure to make the August payment does not constitute an event of default under the bond agreement, according to the notice. — Akiko Matsuda

Avaya investors fuming over the rapid collapse of a leveraged loan issued in June have hired a law firm to examine legal options over what they view as inadequate disclosures during the debt’s marketing process. (Bloomberg)

Share your tips, suggestions and feedback with the WSJ Pro Bankruptcy team: Soma Biswas; Alexander Gladstone; Jodi Xu Klein; Akiko Matsuda; Jonathan Randles; Alexander Saeedy; Andrew Scurria; Becky Yerak. 

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