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Though recent spread volatility in the high-grade bond market has chased away a number of potential issuers, sell-siders remain convinced that 2002 investment-grade issuance will come in close to the $447 billion seen in 2000. Such a total would be well short of last year's $684 billion, but far better than last month's numbers would seem to indicate. Projected over a full year, February issuance through last Wednesday morning would translate to a total of only $340 billion, says Vince Boberski, strategist at Dain Rauscher in Chicago.

Goldman Sachs and Citibank's $1.2 billion credit for SC Johnson Wax has snared a handful of banks for the $550 million pro rata while the "B" is attracting strong buyside support. BANK ONE has signed on for 20% of the total credit, GE Capital, ABN AMRO, and Royal Bank of Scotland have signed on for $100 million pieces while Bank of Tokyo Mitsubishi has taken a $50 million bite. Launched last week in London and New York, the $650 million "B" tranche is also attracting solid support, said a banker following the deal.

John Horner has leftLehman Brothers and joinedJ.P. Morgan Securities as its new 15-year and agency adjustable rate mortgage-backed securities trader. Horner will be a v.p. and report to residential mortgage group chief Kevin Finnerty. He will replace veteran MBS trader Tom DeNunzio, who Finnerty says is looking at other opportunities within the organization, stressing that DeNunzio's decision was voluntary. Horner will also fill the role of agency backed ARMS trader, a slot J.P. Morgan has been looking to fill for sometime, says Finnerty.

Kmart's debt levels fluctuated again last week as investors continue to gauge the value of guarantees that market players are saying the company's subsidiaries will provide on the bank debt (LMW, 2/18). The name began last week with $5 million trading in the 60-63 range down from the 68-71 two weeks ago. After hitting the 62-64 level mid-week, the credit popped up again with $20 million of the name trading in the 63-65 range, said traders. Buyers and sellers could not be determined. Lehman Brothers is rumored to be compiling a report on the retail chain's subsidiaries to shed light on the value of guarantees on the parent company's debt although a bank spokesman denied knowledge of such research.

Lehman Brothers has reassigned Tom Bernard from his role as head of investment-grade and high-yield sales and trading, in a bid to beef up its high-yield origination business, according to Bill Ahearn, a firm spokesman. Bernard will assume additional high-yield duties, working as co-head of high-yield capital markets alongside Rob Redmond, who had been the sole head. He will no longer work with the investment-grade team.

Low cash flow margins should be one of the main focus areas for potential investors in the $350 million senior secured credit for Cumulus Media, according to Moody's Investors Service, which has assigned a B1 rating to the credit. Revenue at the company is suffering from more than just a soft advertising environment, said Dominic Ward, analyst at Moody's, noting that issues at specific radio stations are causing overall low revenues. J.P. Morgan is leading the deal, which is in the market.

Incapital, the Chicago-based underwriter of InterNotes--corporate bonds sold at par to retail investors--is set to announce the addition of several new issuers to its client roster in the next two months. Tom Ricketts, ceo, says he will likely announce two to three new issuers this month, and two to three more in April. He would not disclose names or even sectors of the companies, though he says each is a household name, and each will register a shelf of at least $1 billion.

Steel Dynamics picked J.P. Morgan and Morgan Stanley to lead a $550 million refinancing that includes $350 million of bank debt, after previous lead Mellon Financial sold a portion of its loan portfolio, including the old Steel Dynamics deal. Tracy Shellabarger, v.p. and cfo of Fort Wayne, Ind.-based Steel Dynamics, said, "Mellon sold loan portfolios to GE Capital a couple of months ago." With that relationship gone, the company shopped elsewhere.

Swiss Re will issue a catastrophe bond deal later this month led by Lehman Brothers, according to a buy-side investor. Called Redwood Capital 2, after the first series issued in December (BW, 12/24/01), the deal size should be approximately $200 million. Goldman Sachs, the other major CAT underwriter, will not be part of this deal, according to this investor. Michael Millette, a v.p. and CAT banker with Goldman, declined comment. The investor adds that the transaction is likely to get an investment-grade rating. At present, only 10% of the $2 billion in outstanding CAT bonds are investment-grade. Five percent of outstanding CAT bonds are rated single-B while the remainder are double-B.

Nextel Communications and Global Crossing found popularity with would-be buyers last week with $40-50 million of each name trading. A $2.5 million piece of Nextel's term loans "B" and "C" traded at 84 3/4 in the street following higher bond prices by week's end. The paper, which had been auctioned off as low as 80 two weeks ago, hit the 83 3/4 level by midweek. On Thursday, $2.5 million of the name's "D" term loan traded at 83 3/8. Officials at the company could not be reached by press time.

UBS Warburg is looking to hire two asset-backed analysts to cover the European market and one public sector analyst. One ABS hire will be a replacement and the other a newly created position, says Helen Clement, global head of credit research in London, where the two would be based. At present, the firm only has one ABS analyst after its London-based analyst, Ralf Gasser, was let go amid allegations he and other UBS analysts had accessed Morgan Stanley's research Web site without authorization, according to a Bloomberg article. The public sector analyst will replace Beate Muenstermann, who left at the same time as Gasser. Clement declined to comment on the analysts' departures.

UBS Warburg has added veteran mortgage-backed securities trader Michael Hirschberg to its collateralized mortgage obligation trading effort in New York. Hirschberg joins from Bear Stearns, where he worked for 12 years, beginning as a summer intern on the fixed-income trading floor. Hirschberg will trade trust IO/PO bonds and head up all MBS derivatives trading, according to his new boss, Dave Martin. Martin says the position is newly created, and a response to customer demand for more mortgage derivatives. He will be a managing director.