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UBS and Wachovia Securities are set to lead a $220 million financing package backing the buyout of cabinet supplier Norcraft Companies by private equity firms Trimaran Capital Partners and Saunders Karp & Megrue, according to a banker familiar with the deal. The purchase price for the deal is $220 million, but the banker could not provide the size of the equity commitments in the deal.

BondWeek is the leading news publication for fixed-income professionals, covering new deals, structures, asset-backed securities, industry and market activity.

BondWeek is the leading news publication for fixed-income professionals, covering new deals, structures, asset-backed securities, industry and market activity.

BondWeek is the leading news publication for fixed-income professionals, covering new deals, structures, asset-backed securities, industry and market activity.

KBC Alternative Investment Management, a hedge fund manager with USD2.5 billion in assets, is planning to launch a quantitative statistical-arbitrage credit hedge fund. This would be one of the first hedge funds to pursue this strategy in the credit markets, according to hedge fund sales professionals. Statistical arbitrage is popular in equities but until recently the instruments for shorting credit, such as default swaps, have not been available at tight enough bid/offer spreads to take advantage of the arbitrage opportunities, according to Andy Preston, cio in London.

Last week's surge in implied volatility across Asian currencies on the back of comments from the Group-of-Seven most industrialized countries could spark a long-term boost to volumes. "The recent moves have definitely put the Asian currency market back on more players' radar," said Lee Chee Pin, head of foreign exchange at Bank of America in Singapore.

Tight security at the Roosevelt Hotel caused Robert Pickel, ceo of ISDA, to speculate that hotel staffers were taking Warren Buffet's comment that derivatives are "weapons of mass destruction" a bit too literally.

Standard & Poor's has hired Sue Harding, former head of global accounting strategy for the equity research group at Credit Suisse First Boston in London and former chair of the International Swaps and Derivatives Association's European accounting committee, as its European chief accountant. This is part of the rating agency's effort to build its accounting expertise in response to increasingly complex accounting rules, according to Clifford Griep, chief credit officer in New York. Derivatives is one of the more opaque areas, said Griep, adding that Harding's expertise in that will be helpful.

Bank of Tokyo-Mitsubishi has transferred its credit derivatives trading operation to its securities arm, Mitsubishi Securities, to offer a wider range of instruments to a broader client base. The move has been in the works since last year (DW, 5/4), but the securities firm did not receive a license from the Japanese Financial Services Agency until earlier this summer, according to Nobukazu Saeki, chief manager of the newly-created credit trading department.

TRAC-X North America, which follows the most liquid 100 credit-default swaps, widened 2 basis points to 64bps Wednesday morning before a flurry of trades pushed it back in line with the tightening trend that has gripped the credit markets over the last several months. The index finished the day at 62bps. James Parascandola, credit derivatives trader at Barclays Capital in New York, said the shift was a considerable one for the index, which is generally not volatile.

Credit derivatives traders have agreed not to include the restructuring credit event for default swaps that reference monoline insurance companies. Lawyers said major market players agreed to make the switch on Sept. 15, because of complications with how the trigger would work.

"So many of us have to pay for the sins of a few."--Ernest Patrikis, International Swaps and Derivatives Association board member and senior v.p. and general counsel at American International Group, commenting on the origins of recent legislation, including FAS 133. For Complete Story, click here.