The bank debt for ITC^DeltaCom slumped into the mid-90s after the company announced that it was pulling an offering of $300 million in second-lien senior secured notes and floating rate, second-lien senior secured notes. Proceeds from the offering had been earmarked to pay down the company's bank debt. ITC had approximately $184 million under its senior credit facility and $55.7 million under a junior credit facility at the end of last year, according to the company's annual statement.
One trader noted that ITC's failure to complete the bond deal was particularly worrisome for the market because the company was considered a strong name. The bank debt had been quoted up as high as the 983/4 to 991/3 range, according to Mark IT/LoanX. Traders quoted the name in the 95-97 range after the news. In a company statement, Douglas Shumate, ITC's senior v.p. and cfo, said the generally weaker market conditions and investors' stronger preference for fixed-rate notes made the transaction unattractive. Shumate did not return calls by press time.