Federal Mogul's bank debt softened to a bid-offer spread of 50-52, coming back about a point after a high two weeks ago of 52 ½-53. However, no trades were reported. Dealers said the restructuring may be more drawn out than originally thought. "The market just stinks right now, and people are concerned that it could take longer for the company to get out of Chapter 11," a dealer said.
Washington Group's term loan traded at 63-64 earlier this week while the revolver hit 73-75. This is a downgrade in levels last summer of 82-83. The company is undergoing a confirmation hearing as it tries to pull out of Chapter 11.
Nextel Communications' bank debt is offered at 84 5/8, but there are no takers yet this week. Dealers faulted a limited number of buyers and a shaky market for Nextel's continued softening. About $5 million of Dresser Inc.'s credit $5 traded around 100. The credit's been in the 101 range since the summer.