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BondWeek is the leading news publication for fixed-income professionals, covering new deals, structures, asset-backed securities, industry and market activity.

BondWeek is the leading news publication for fixed-income professionals, covering new deals, structures, asset-backed securities, industry and market activity.

BondWeek is the leading news publication for fixed-income professionals, covering new deals, structures, asset-backed securities, industry and market activity.

BondWeek is the leading news publication for fixed-income professionals, covering new deals, structures, asset-backed securities, industry and market activity.

When Fleming Companies filed for bankruptcy last week, company officials probably did not speculate on the erroneous conclusions some would make in regard to its chosen petition date. "I think the filing is an April fool's joke, everything is fine," one market player said of Fleming's decision to pursue a Chapter 11 bankruptcy. He retracted his statement three days later, when the company did not seem to be joking.

This chart, provided by Citibank/Salomon Smith Barney Inc., tracks bid-ask prices for par credit facilities that trade in the secondary market. It also tracks facility amounts, ratings, pricing and maturities.

The $440 million credit backing Kohlberg Kravis Roberts & Co. and Trimaran Capital Partners' $610 million acquisition of International Transmission Co. (ITC) from DTE Energy scored with investors because of its straightforward and stable business, according to Dean Kehler, a managing partner at Trimaran. The six-year credit blew out after launch, resulting in an increased "B" loan. Kehler said while other utilities are struggling, DTE and ITC are stable regulated entities. "DTE is actually one of the healthiest utilities in the United States," Kehler said, explaining that the company was not financially strapped and it did not need to divest ITC.

Bill Hughes, a managing director in Deutsche Bank's senior debt capital markets group, left the bank for Lehman Brothers last week. Hughes managed deals in the telecommunications and energy sectors while at Deutsche Bank and is believed to be focusing on the same sectors at Lehman. Hughes will be reporting to Steve Sterling, a managing director at Lehman. A Deutsche Bank spokesman confirmed Hughes' departure, noting the firm is looking at internal and external replacements, while a Lehman spokeswoman did not return calls. Hughes could not be reached by press time.

Lenders representing more than one-third the outstanding bank debt claims of Hayes Lemmerz International were holding out on approving the company's current plan of reorganization last week, still looking for more recovery as LMW went to press. Across the table from the banks, senior note holders are threatening to take legal action that could impair lenders' recovery. "The banks who oppose the plan of reorganization may not have realized the weakness of their position," said one senior noteholder. "The unsecured creditors may well initiate litigation to attack the liens in Europe." Lenders seemed unfazed. "Frankly, I think they're bluffing," one lender said.

An auction of $54 million worth of NRG Energy's $2 billion credit facility held by its finance company was said to have gone off in the 27 1/2 to 28 1/2 context a week ago last Friday. The buyer and seller of the piece could not be determined. Traders said if the market for the finance company's bank debt rises into the 30s, there will be many more lenders looking to unload. Two weeks ago, the paper rallied from the low 20s after NRG's parent company, Xcel Energy, announced an agreement with NRG creditors that would give NRG a larger than expected payout (LMW, 3/31).

Pricing on the four-year, $400 million "B" loan for International Steel Group (ISG) is likely to be in the LIBOR plus 31/2% to 33/4% range after the credit received split ratings of Ba2/BB+ from Moody's Investors Service and Standard & Poor's (see story, page 7). Pricing on the two-year bullet $300 million "A" loan is expected to be in the LIBOR plus 3% to 31/2% range, while the $300 million three-year revolver will price at LIBOR plus 23/4%, said a banker. Retail syndication will kick off on Wednesday, he added. Goldman Sachs, UBS Warburg and CIT Group lead the $1 billion asset-based bank facility, which backs the $1.5 billion acquisition of Bethlehem Steel. CIT is collateral agent and will monitor the borrowing base and run all the metrics, explained the banker.

International Steel Group's (ISG) new collective bargaining agreement with the United Steelworkers of America allows the company to reduce labor costs through staff cuts and to shed its legacy liability for pension and healthcare plans. According to Steven Oman, senior v.p. at Moody's Investors Service, this provides sizeable cost and productivity benefits. Low leverage and margin enhancement opportunities contribute to the Ba2 rating on ISG's $1 billion senior secured credit facility, which in addition to private equity financing from WL Ross & Co., funds the acquisition of Bethlehem Steel Corp's assets.