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Buysiders last week faced either approving an amendment on Dean Foods' $1 billion "B" tranche that will leave them 50 basis points out of pocket, or standing by while a high-yield bond deal takes out at par all the bank paper-- which was trading above 101. As Loan Market Week went to press, the 100% approval from the funds was about to be clinched, said one investor, who said, "Nobody is happy to lose 50 basis points, but if we don't approve, they have been shown a bond deal they will take." Pricing is currently at LIBOR plus 3%, but the amendment will cut the pricing grid by 1/2% on the Wachovia Bank and BANK ONE-led loan.

Universal has increased the size of its new credit facility to further develop banking relationships and increase flexibility. The company decided to upsize the loan amount to $295 million after the credit was oversubscribed, said Karen Whelan, v.p. and treasurer for Universal. Whelan explained the company had the opportunity to expand its relationship bank group and have additional flexibility by accepting all of the commitments offered on the deal. Wachovia Bank led the deal, but Whelan would not disclose the names of the three new banks that joined on for the new credit.

Wachovia Bank's $240 million refinancing for Kwik Trip filled up quickly after a bank meeting held in Wisconsin early last week. An official following the syndication said the loan, comprising a $190 million revolver and a $50 million "A" term loan, is already oversubscribed. She could not provide the names of the other banks that have signed up for the deal. Pricing on the five-year bank facilities is LIBOR plus 13/ 4%, with grid pricing on the revolver. There is a 3/8% fee for the unused revolver, she added. Kwik Trip is a privately owned convenience store chain.

Just $5.9 billion in new supply hit the investment grade market (only $3.9 billion excluding AAA EETCs and Supranational borrowers) in one of the quietest weeks of the year. The pattern of issuance was similar to the previous week with many off-the-run borrowers accessing the market with smaller size deals. This was the second week in a row that the average deal size was less than $400 million. With the market fixated on the volatility in turbulent sectors like telecom (WorldCom dropped about 20 points on the week and Qwest was down 3 or 4) and other benchmark borrowers like Tyco, there is little appetite for adding to risk positions. Add in the fact that it was an active week for bid lists, with several hundred million bonds dumped onto dealer books, and the near-term technical position of the market remains poor.

Just $5.9 billion in new supply hit the investment grade market (only $3.9 billion excluding AAA EETCs and Supranational borrowers) in one of the quietest weeks of the year. The pattern of issuance was similar to the previous week with many off-the-run borrowers accessing the market with smaller size deals. This was the second week in a row that the average deal size was less than $400 million. With the market fixated on the volatility in turbulent sectors like telecom (WorldCom dropped about 20 points on the week and Qwest was down 3 or 4) and other benchmark borrowers like Tyco, there is little appetite for adding to risk positions. Add in the fact that it was an active week for bid lists, with several hundred million bonds dumped onto dealer books, and the near-term technical position of the market remains poor.

J.P. Morgan Securities, on the back of the recently announced firm-wide reorganiztion, has reduced the headcount in its London-based debt capital markets and structured finance businesses. The precise number of layoffs could not be learned, but an industry official who has spoken to a member of the firm's human resources team says the firm has been forced to let go of high achievers with strong track records from analyst through to the managing director level. One London-based executive recruiter says he has seen 11 resumes from the structured finance group and a handful from DCM. Calls to John Mayne, co-head DCM Europe and Tamara Adler, head of securitization, were not returned by press time. Eileen Darko, a firm spokeswoman, did not return calls.

The market for WorldCom's $2.65 billion, 364-day revolver has fallen from 92-95 to 80-85 after reporting first quarter losses and ratings agency downgrades. No trades could be confirmed. "The question is, can you find a real bid," one trader explained of the discrepancy. With the bonds trading in the 60s range, the true value of the 364-day revolver is priced off in the 80-85 range, a dealer explained.

Xerox's bank debt traded in the 94-95 range this week with more than $15 million changing hands amid buzz surrounding the company's attempt to extend part of its bank line maturing in October. Market players hold conflicting opinions on whether or not the company will be able to extend the line. "At the end of the day it's a low 90s name," said one trader.

GE Corp Australia Funding burst onto the market this week with a A$1.7bn multi-tranche transaction, setting a new record for the largest ever Australian bond. The strength of investor demand meant that the jumbo deal was increased from A$1bn. The sheer scale of the deal left observers astounded - while many believed it was quite expensive, the praise for GE's ability to gain hitherto unseen levels of investor participation has been universal.

Japan's ministry of finance has requested proposals from would-be lead managers for the planned disposal of 333,334 shares in Japan Tobacco. The investment banking community in Tokyo was less than enamoured with the timing of the request. The proposals must be lodged with the MoF by May 7, immediately after the Golden Week holiday period in Japan.

Korea Development Bank (KDB) took advantage of its recent upgrade and the benign market conditions this week to launch a remarkable re-opening of its $500m 5.25% 2006 transaction. The bank took advantage of the glowing investor sentiment towards Korea after Moody's recent two notch sovereign rating upgrade, with KDB pricing the $300m tap through the secondary market bid level of its existing bonds. Even at this tight level, the transaction was still almost twice oversubscribed.

Hong Kong Mass Transit Railway Corp (MTRC) launched its second Hong Kong dollar retail-targeted bond, marking the first such deal from a Hong Kong listed company. The HK$1bn issue has three tranches with two, three and four year tenors, and coupon levels of 3.75%, 4.5% and 5% respectively. The subscription price will be fixed on May 7. HSBC and Standard Chartered were joint lead managers.