The bank debt of Exide Technologies has dropped 20 points over the last two weeks on news of the need for covenant relief. In a series of small trades, the credit has dropped from the low 80s in mid-October to the low-60s as of late last week. Dealers estimate the trades were made in $5 million chunks and totaled between $10-20 million, but buyers and sellers could not be determined.
The maker of car batteries announced on Oct. 25 that it was pursuing a covenant waiver, but officials would not specify what type of relief the company was looking for. Exide plans to issue an earnings report later this week. Lisa Donahue was named cfo and chief restructuring officer in late October following the departure of Kevin Morano. Calls to finance officials and to Tom Smith, head of investor relations, were not returned.
Adding to the sting for the company Standard & Poor's downgraded the company's credit to CCC from B- last Tuesday. "There's just a lot of bad news out on them," a dealer said. The fact that the company's main business is automobile batteries isn't helping. "Everything related to automotive is trading down," a dealer noted.