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Rexam, the world's largest producer of beverage cans and the fifth-largest consumer packaging company, entered an interest-rate swap and a cross-currency interest-rate swap on the back of two separate bond offerings earlier this month. The company entered a vanilla interest-rate swap to convert a fixed-rate liability in euros and another to convert a fixed-rate sterling-denominated liability into a floating-rate, U.S. dollar-denominated obligation. Chris Bowmer, treasurer in London, said the U.K.-based company has nearly 90% of its operations abroad but also has a strong investor base at home, which is why the company issued in sterling and then converted to dollars. "We have stronger recognition here, investors are more familiar with the company and are more familiar with the equity story," he noted. The company has a GBP2 billion (USD2.9 billion) market capitalization.

Waddell & Reed is looking to sell some $30 million in Fannie Mae 6.5-year pass-through securities. Jim Cusser, portfolio manager of $1.1 billion, says spreads between pass-throughs and five-year Treasuries will not continue to tighten, because volatility is subsiding. Cusser has still not determined whether he will buy two- to five-year bulleted agencies or lower-grade corporates with the funds he raises. Cusser says he will look to Waddell & Reed's equity analysts and the stock market to see whether top-line corporate growth is translating into bottom-line profitability, given accounting worries at many companies. If he feels companies can translate the improving economy into stronger earnings, he will choose corporates rather than agencies. He would not specify a stock market level that would make him more optimistic about potential for corporate profits, and says only that he will monitor earnings announcements.

Usually loan traders are more than hesitant to disclose the strategies and tactics they use to close a deal. Last week, however, one starry-eyed loan trader could not boast enough about how a trip to Italy and a moonlit walk helped him win out the competition for one lucky lady. Who is this Don Juan of the syndicated loan world? He may be sitting next to you.

QCI Asset Management will swap 10% of its portfolio, or $35 million, out of corporates into Treasuries when corporate spreads tighten by 50 basis points, which should happen toward the third quarter, says Paul Roland, portfolio manager. Roland notes that corporate single-A industrials, as of last Monday, yielded 100 to 135 basis points over the curve. Roland wants to see those spreads decrease to 50 to 85 basis points over Treasuries in order to trigger the move. He declined to specify any credits that would be sold.

Edinburgh Fund Managers is reducing the duration of its $450 million fixed-income portfolio from roughly eight years to about six. Edinburgh, Scotland-based Michael Turner, head of fixed interest, says the move was prompted by the firm turning negative on the bond market, because an economic recovery, no matter how strong or weak, will push yields higher once central banks begin to raise rates. The firm uses a variety of benchmarks.

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.

UBS Warburg and Credit Suisse First Boston have landed lead roles on an upcoming bank deal for Harvest/ AMI Holdings, a newly formed company from New York-based leveraged buyout shop Harvest Partners, for the acquisition of Associated Materials. The total purchase price is $436 million, which includes $75 million of outstanding subordinated notes that will be refinanced, said a banker familiar with the transaction. The bank deal should be in the region of $165 million and bonds will accompany shortly afterwards, he added. A date for launching the bank portion is likely to be in the next few weeks. The two banks in addition to CIBC World Markets will play a role in the bonds, he said. The equity component and size of the bond offering could not be determined.

Wachovia Securities is shopping a credit for Ability One, a manufacturer of medical devices for rehabilitation, and is wrapping up a credit forMedSource Technologies. The Ability One deal is a $135 million facility, split between a $20 million revolver and a $115 million term loan. Pricing on the revolver is LIBOR plus 31/ 2% and LIBOR plus 4% on the term loan, according to a banker. Up-front fees are 1% and 3/8%, respectively. The credit backs the acquisition of a company, he said, declining to name the target.

GECC remained the focus in the primary market as the company filed a $50 billion shelf just a week after its $11 billion deal. GECC said that it was looking to decrease its reliance on the commercial paper market and that it would be tapping the public markets again to term out CP. GECC spreads have suffered as a result with the new deal underwater by about 15-20 bp across the various tranches; this is significant underperformance and volatility for a AAA asset. More importantly, however, the GECC move raises the question of whether other financial companies will take measures to reduce their commercial paper funding and whether this will affect the technicals in the corporate bond market. A big part of the corporate bond supply story in 2001 was the big reduction in non-financial commercial paper; should the financial sector follow in 2002, supply may meet or exceed last year's record levels.

Harry Resis, head of high-yield at Zurich Scudder Investments in Chicago and a longtime and high-profile portfolio manager, is giving serious consideration to leaving the firm, according to three senior sell-side officials who say they have spoken to him directly about the matter. They say he is unhappy over the planned reorganization of the high-yield business following Deutsche Asset Management's acquisition of Scudder, which is expected to be finalized within the next few months. While details are still being worked out, the plan would be to move the bulk of Scudder's roughly $5 billion in high-yield assets to Philadelphia, where it would be managed by Andrew Cestone, who currently manages some $650 million for Deutsche Asset Management. Resis, reached at Scudder's offices in Chicago, declined comment.

Bank of America and Credit Suisse First Boston's credit for dialysis provider, DaVita, was shown last week to a buyside eager to jump in on the huge $800 million "B" piece. "They're bumping up the leverage, but they generate so much cash flow and they plan to continue to pay down debt," said one buysider who is looking to invest in the seven-year term loan "B" at pricing of LIBOR plus 3 1/4 %. Rich Whitney, cfo at DaVita, is optimistic that interest in the name will generate enough orders to potentially result in a reverse flex on the deal. "There's a good chance they'll be a flex down," he said, regarding positive buzz on the credit.