A $26 million hybrid piece of The Goodyear Tire & Rubber Co.'s senior bank debt was auctioned off north of 90 1/2 last week. The piece that changed hands comprised portions of the company's $750 million U.S. revolver, $645 million U.S. term loan, as well as its $650 million European credit. For the blended piece, the trend in price is upward, said one dealer. The company's revolver last traded in the 87 context and the term loan was said to have traded in the 91 context before the auction.
The motive behind the sale and the identities of the parties involved in the transaction could not be determined. "It's the flavor of the month," said one trader, explaining the recent movement of Goodyear's bank debt. "People get their claws on something and then it's hot for awhile." This month Goodyear refinanced and restructured its bank debt, molding its existing bank debt into the aforementioned facilities. The Akron, Ohio-based company also added a new $1.3 billion asset-backed line. Calls to a Goodyear spokesman were not returned.