Travelport's term loan dipped 1/8-1/4 of a point to 100 3/4 after the travel company announced in a conference call regarding its second quarter earnings it would not be providing earnings guidance for the rest of the year, according to a dealer. He said trading in the loan had been mostly inactive before the announcement, but since then trading activity has picked up.
Travelport, formerly Cendant Travel Distribution Services, reported a $1.1 billion net loss for the second quarter. This includes an impairment charge that arose from the difference between the price at which Travelport was sold to an affiliate of the Blackstone Group and the historical carrying value of Travelport's net assets, according to a company release. It also included $20 million of separation costs from Cendant Corp. and an $11 million restructuring charge.
UBS, Credit Suisse and Lehman Brothers lead the term loan, which is part of a financing package that backed the Blackstone Group's $4.3 billion acquisition of the online travel business from Cendant Corp. (CIN, 8/21). Blackstone completed the acquisition in August. A Travelport spokesman said the company's decision not to give guidance should not be construed negatively. He added the company is private and is therefore under no obligation to give guidance. It will report its third quarter results in mid-to-late November and there will be a lot of information publicly available at that time, he said.