Search results for

It was another active week for both investment- grade and high-grade primary market corporate issuance. $5.3 billion of investment-grade volume was supplemented by $2.8 billion of high-yield deals and yet the market was able to digest the supply with little problem. In fact, some deals during the week were oversubscribed within minutes of being announced, even after upsizing, and still tightened on the break as the technical bid in the market continued. With a heavy schedule of high-yield deals and little supra/sovereign issuance this week, the weighted average rating of new deals has dropped back to more normalized levels than had been seen in January.

Danske Bank plans to add an originator to its London-based securitization team to ramp up its marketing efforts in Finland and Sweden. Geoff Simms, head of securitization, says one of his goals is to grow the firm's $1.5 billion asset-backed commercial paper conduit this year and to do that, another originator is necessary to aggressively market the firm's services. Danske Bank's speciality is in ABCP.

CRT Capital, a Stamford, Conn.-based junk and distressed bond dealer, has hired three senior professionals who left DrKW-Granchester when that firm sharply scaled back its business in December (BW, 12/15). CRT, which has specialized in distressed securities and busted convertibles, sees the cutbacks by Grantchester as an opportunity to make inroads in the mainstream high-yield market, according to Chris Young and Mike Vaughn, two of CRT's three managing members. The firm plans several mores hires in research, trading and particularly sales, says Young.

Federal-Mogul Corp. bank debt started trading actively after the company announced it has reached an agreement in principle on a reorganization plan. The bank debt was quoted in the 74-76 level up from the high 60s, where it was trading two weeks ago. "People think that there is upside at these levels," noted one dealer.

Investors in Fleming Companies' bank debt are hoping asset sales or even a complete overhaul of the company's Deutsche Bank-led credit will take them out at par. Levels on the existing "B" loan are holding ground, despite news that the company would be terminating its supply contract with its largest customer, Kmart. Traders quoted the "B" paper in the 97 3/4 99 1/4 context due to the lingering possibility that the company's term loan will be taken out within the next three months either through asset sales or through a new asset-based facility. The company has $325 million of term loan outstanding.

GoldenTree Asset Management has made a pair of new hires as it looks to continue growing assets. The firm hired Frank Jordan, a veteran high-yield salesman and the 1998 BondWeek sales executive of the year, to the new position of director of client services, according to a senior high-yield buy-sider with knowledge of the move. He will report to Leon Wagner, chairman of the New York-based firm, which in its three-year history has grown assets to just under $4 billion.

Harris Trust & Savings Bank is leading a $140 million credit backing Racing Champions Ertl's acquisition of Learning Curve International. A banker familiar with the deal could not confirm structural details. The transaction is expected to close by March 15. Following the union of the two Illinois-based toy companies, funded debt to EBITDA figures are expected to be under two times.

New issues were the main focus last week as TRW Automotive priced a $1.58 billion deal. Gaming weakened slightly. Here is other action.

National Bedding Company faces some tough integration risks by acquiring bankrupt Sleepmaster, promptingMoody's Investors Service to slap a B1 rating on the company's $235 million acquisition facility. Kevin Ziets, associate analyst at Moody's, said the company will have its work cut out for it in digesting Sleepmaster. "Any acquisition involves risks, but when the deal more than doubles the size of the company and when the acquired has been preoccupied with Chapter 11 proceedings, the challenges of integration are greater," he noted.

DIRECTV is set to hit the market Thursday with a $1.55 billion credit that includes an $800 million institutional loan. Deutsche Bank and Bank of America are leading the fully underwritten deal, with Credit Suisse First Boston, Citibank and Goldman Sachs on the agent level. The deal was pitched to senior managing agents last Wednesday.

AES Corp.'s bank debt benefited from the sale of Cilcorp--its utility holding company whose largest subsidiary is Central Illinois Light Company--to Ameren Corp. for $1.4 billion. The market for AES' "A" piece climbed into the 97-98 context and the "B" and "C" tranches were said to be trading in the 94-95 1/2 range. AES received roughly $500 million in net equity, $250 million of which was used to pay down the company's bank debt.

Chohung Bank is looking to launch a $250m tier two debt issue to shore up its capital base after making big loan loss provisions in 2002. Citigroup/SSB will be sole bookrunner for the 10 year non-call five deal and also has a mandate for a tier one hybrid sub debt bond for Chohung.