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Another healthy week for issuance, with over $14 billion in investment grade, high yield and emerging markets debt coming to market. Highlights of the week included the $1.75 billion three-tranche deal for Citizens Communication, a $1.5 billion transaction for the Williams Companies and deals from several utilities including PPL ($800 million), Appalachian Power ($125 million), Wisconsin Public Service ($150 million), and Michigan Consolidated Gas ($200 million). The week also included a relatively healthy high yield calendar ($1.8 billion) a tap of the Colombia '20s for $325 million and many convertible deals (not included in the statistics below), of which Nortel was the most interesting following on the heals of Lucent's offering. Most of the deals on the week were smaller in size, with the average deal size dropping to below $400 million for only the fourth time this year. Weighted average credit quality was stable at BBB+.

Bank of America's portfolio-pruning mode kicked into high gear last week as the bank sold more than $200 million in asbestos-related names. B of A has been busy reducing the number of names in its portfolio, but dealers said last week the big lender was particularly active. The bank reportedly sold a $50 million piece of Federal-Mogul to kick off the week at a level in the high 50s and then continued unloading with a $70 million piece of W.R. Grace; $85 million of Owens Corning in the mid-60s; and $70 million of USG at a level of about 70. The levels on those names moved up with the trades. Peter Santry, managing director and head of distressed trading for Bank of America, declined to comment. Buyers of the paper could not be determined by press time.

Blackwood, N.J.-based A.C. Moore Arts & Crafts has closed a new $50 million revolver, doubling the capacity of the previous loan. Leslie Gordon, cfo, said the existing facility was set to mature in April 2002 and this coincided with plans to increase the size of the company and the opening of new stores. Key Bank, the existing lead arranger, was retained and First Union National Bank was added to the lending group, he said.

Traders said Finova Group's bank debt last week hit its highest level year-to-date, trading between 94 and 94 1/4 and remaining steady after news was released regarding approval of the company's new reorganization plan. The paper had been trading in the low 90s. "[Finova] traded up a lot on the positive news of the settlement. It takes a lot of the uncertainty out of the credit," said one trader. "We were all waiting to see what happened [August 10]," said another. It could not be determined how much of the paper traded last week.

Deutsche Bank's innovative financing structure for Premcor Refining Group seemed to strike the right note with investors as the deal filled last week and was set to be upsized. A banker familiar with the credit said that total commitments should be $650 million and the revolver will almost certainly be upsized from $350 million. The $150 million term loan will possibly also be increased, depending on the math, said the banker. He was unable to say by how much at this stage or name the institutions committing, as allocations have not yet been set.

J.P. Morgan is set to lead a $680 million credit for Advance Auto Parts to fund the acquisition and merger of Discount Auto Parts and refinance existing credit lines. Credit Suisse First Boston and Lehman Brothers are co-arrangers on the loan. A banker familiar with the deal noted the old $465 million loan, arranged in 1998 led by Chase Manhattan Bank and Donaldson, Lufkin & Jenrette, had a six-year maturity.

Laidlaw is in talks with several U.S. and Canadian banks about arranging a $250 million revolving credit facility and a $500 million high-yield bond issue for when it emerges from Chapter 11 bankruptcy. Geoff Mann, v.p. and treasurer at the Burlington, Ontario-based transportation company, said Laidlaw has obtained a $200 million, two-year secured revolving debtor-in-possession (DIP) facility that will provide liquidity while the company is in court proceedings. The plan has not yet been voted on to put in place the exit facility, but it is expected to be a syndicated $250 million revolver, he added, declining to name the potential banks to lead the facility or bond offering. Laidlaw intends to exit from bankruptcy proceedings within six months to a year, he noted.

Laidlaw is in talks with several U.S. and Canadian banks about arranging a $250 million revolving credit facility and a $500 million high-yield bond issue for when it emerges from Chapter 11 bankruptcy, according to BW sister publication Loan Market Week. Geoff Mann, v.p. treasurer for the Burlington, Ontario-based transportation company, said Laidlaw has just obtained a $200 million two-year secured revolving debtor-in-possession facility that will provide liquidity while the company is in court proceedings. The plan has not yet been voted on to put in place the exit facility, but it is expected to be a syndicated $250 million revolver, he added, declining to name the potential banks to lead the facility or bond offering. Laidlaw intends to exit from bankruptcy proceedings within six months to a year, he noted.

Traders said HSBC bought a $25 million piece of Federal-Mogul's $1.75 billion outstanding bank debt from Bank of America in the 67-68 context last Monday--a few points higher than the mid-60 level the market saw last month for the credit. Last month, investors were reportedly pulling back cautiously, anticipating a Chapter 11 filing by the company, dealers said. Since last month, investors are getting more comfortable with the idea that the company may not file for Chapter 11 immediately as it hasn't yet made a move after much speculation last quarter. Calls to James Fisher, spokesman at Federal-Mogul, were not returned by press time. Calls to officials at HSBC were not returned by press time.

Hollister tapped First Union to lead an $80 million refinance credit that rolls up a series of uncommitted lines from various lenders. William Sauerland, treasurer, described syndication of the credit as a "formalization of all of our uncommitted lines." He explained the company's existing $80 million of available debt was previously split between numerous lines of unfunded 364-day revolvers, led by a handful of separate banks. "Given changes in the market, banks have gotten a lot smarter than they used to be with their asset-allocation models," he commented.

Morgan Stanley has unified its high-yield, investment-grade and emerging markets fixed-income research and trading coverage of a number of "crossover" companies--credits that shift back and forth between high-grade and high-yield. Stephen Penwell, global head of credit research atMorgan Stanley, says the firm is looking to capture an area of the market that it had previously overlooked. The firm sent out its first crossover research piece, on British communications equipment-maker Marconi, earlier this month.

Nomura Securities International is reportedly taking a novel turn on a $6 billion, one-year line of credit for Bayerische Landesbank, accepting commercial-, asset- and mortgage-backed securities as collateral, according to BondWeek, an LMW sister publication. Current and former Nomura fixed-income executives said the agreement called for Nomura to provide the 364-day revolver for a fee of two basis points, or $1.2 million.