Federal-Mogul has fluctuated this week with roughly $15 - 20 million trading following news that Carl Icahn and other bondholders have struck a deal with asbestos claimants. Dealers said the name traded as high as 66 following the news on Tuesday, but that by noon Wednesday it had traded in the 62-63 range.
Immediately following reports of the deal, investors believed that the bank debt could be reinstated at par, one market player explained. New reports, however, suggest that the bondholders might try to get the bankruptcy court to rescind the collateral liens that bank lenders have to the company's assets. Federal-Mogul has issued a statement that it has not agreed to any plan. Calls to the company were not returned by press time.
Crown Cork & Seal has also traded up on the prospect for resolution surrounding its asbestos liabilities with $20 million of the name trading in the 90 1/2 91 1/2 range. The name has ticked up from 87 where it was moving three weeks ago on the rumblings that a refinancing plan was in order (LMW, 3/25). Calls to Timothy Donahue, senior v.p. of finance, were not returned by press time.