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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. 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.

Citizens Communications is preparing to refinance $2 billion in loans between now and October when existing lines mature. Don Armour, v.p., finance and treasurer for Citizens, said the refinanced revolver would most likely be a multi-year backstop with the same institutions that led a $5.7 billion line arranged last year. Chase Manhattan Bank was the lead arranger on that credit, which has been downsized after a $1.7 billion note sale earlier this year and will be cut even more by a planned $1.75 million private offering of 144A senior notes. The company is coming in wit a $2 billion deal because it does not need a revolver as large as the existing facility.

Continuing the trend of loans being offered at an original discount in syndication, Credit Suisse First Boston's deal for The Ackerley Group has been sold at a cut-price 97 to investors, according to a banker following the deal. After the market was offered the credit at a discount, the $120 million loan was oversubscribed. The discount will cut into the net proceeds of deal rather than being covered by the bank through fees. Both the $20 million revolver and the $100 million five-year term loan "B" were discounted in syndication. Pricing was LIBOR plus 3 3/4% and 4% over LIBOR, respectively, for the tranches. The revolver also carried a jumbo 1 1/2% commitment fee to facilitate syndication.

The dog days of August, indeed. One dealer said, "It's definitely August," as few names and significant trades have been talked about in the first part of this week. Notable is a $25 million piece of Federal Mogul's bank debt that was rumored to be sold by Bank of America to HSBC at 67-68 as the debt level ticks up upon uncertainty regarding a possible Chapter 11 filing. Today, traders were keeping their eye on a $20-30 million piece of Owens-Illinois that was rumored to exchange hands as all asbestos credits are reportedly receiving a little relief as litigation concerns have subsided.

Traders said Finova Group's bank debt this 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 last Friday," said another. It could not be determined how much of the paper has traded this week.

Deutsche Bank's innovative financing structure for Premcor Refining Group seemed to strike the right note with investors as the deal filled this week and looked 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.

Jaap Rademaker, v.p. in the structured transactions group at Deutsche Bank in London, has joined J.P. Morgan in a similar position. Rademaker will report to Bertrand des Pallieres, head of rates marketing and structuring at J.P. Morgan in London. Des Pallieres confirmed the appointment but declined further comment. Rademaker could not be reached.

Sweden-based asset manager SEB Invest plans to launch a market neutral hedge fund in Denmark, which will use interest-rate swaps, forward rate agreements, futures and listed equity options for investing and hedging. The fund will look to execute all its derivatives transactions through a prime broker which it expects to chose in the next couple of weeks, according to Niels Lorentz, institutional client salesman in Copenhagen. The most important criteria for the prime broker is to have a global reach because the fund wants access to the Japanese and U.S. markets.

Japanese corporates have started entering collars in the last month to hedge positions in the sinking Tokyo equity market in preparation for the introduction of mark-to-market accounting in September. "Before they were just buying puts, now they're buying collars," said Jim Clark, head of equity trading at UBS Warburg in Tokyo. He continued that because of low market levels, corporates are nervous and are hedging against further downside with puts. If stocks rise, the calls could be executed, but Clark said corporates are happy to unwind cross holdings at higher than current market levels, because selling the calls partly offsets the cost of buying the puts.

Bankgesellschaft Berlin placed a USD400 million private synthetic collateralized debt obligation last month. Richard Gillingham, head of credit derivatives in London, said the reference portfolio is made up of over 50 credit-default swaps on investment grade corporates in North America and Europe. The companies had an average rating of A minus. Investors bought into the five-year deal through either credit-default swaps or credit-linked notes, according to Gillingham. He declined further comment about the CDO.

J.P. Morgan has hired Stephen Stonberg, former European head of structured credit derivative products at Deutsche Bank in London. Stonberg, who had recently moved internally to take a senior position marketing fixed income products to Deutsche Bank's private banking clients, resigned last week and is expected to take a global position in repackaging and structuring credit at J.P. Morgan, in London, according to a market official. Stonberg and officials at J.P. Morgan declined all comment.