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Wackenhut Corrections Corp.'s heightened leverage is the biggest concern for Moody's Investors Service, which has given a Ba3 rating to the company's new $150 million credit facility. Proceeds from the deal will go toward financing the correctional facility company's purchase of all its shares currently held by majority shareholder Group 4 Falck, a Danish security firm. "The transaction weakens the company's profile because it increases its total leverage [and] it also reduces the fixed charge coverage on their debt," said Philip Kibel, v.p. and senior credit officer at Moody's. But the repurchase of the Group 4 Falck's ownership is a significant benefit for Wackenhut. "They will become a fully independent company now [with] operating autonomy," Kibel said.

The $100 million "B" loan for Worldspan, a travel reservation data company, was oversubscribed last week. There was early speculation that investors might not take to a credit for a company related to the ailing air travel industry, but buysiders oversubscribed the deal in under a week. Lehman Brothers and Deutsche Bank lead the facility. The $150 million credit for the Atlanta-based company backs the acquisition of Worldspan by Travel Transaction Processing Corp., a company formed by Citigroup Venture Capital Equity Partners--a private equity fund managed by Citigroup Venture Capital--and Teachers' Merchant Bank, the private equity arm of Ontario Teachers' Pension Plan. The private equity entities are buying Worldspan from Delta Air Lines, Northwest Airlines and American Airlines.

Several of the lead banks on Xerox Corp.'s $1 billion credit facility were said to be offering the $700 million revolver at a steep discount shortly after allocation last week, with offers in the high 80s to low 90s. Bankers and investors said of the six underwriters, Citigroup, Deutsche Bank, Goldman Sachs, J.P. Morgan, Merrill Lynch and UBS Warburg, several were seen offering the revolver at these levels. One investment bank was rumored to have sold off between $50-75 million of the loan. A Xerox spokeswoman declined comment and officials at the lead banks either declined comment or did not return calls by press time.

Wachovia Securities has priced the debt for Callidus Capital Management's debut loan deal, a $300 million cash flow vehicle called Callidus Debt Partners CDO Fund II. The CLO uses the Wachovia APEX structure, which differs from traditional CDOs in that it includes three swaps entered into between Wachovia and the fund. The deal is also unusual in that the $246 million of AAA notes were wrapped by AMBAC Asset Assurance. The notes were priced at LIBOR plus 50 basis points, said a source. But the charge for the wrap from the insurer was not included in this, he said, and this will probably cost in the region of 20 basis points. Officials at Callidus declined comment until the vehicle closes at the end of this month.

Bear Stearns is talking to equity investors in collateralized loan obligations for Octagon Credit Investors' Octagon VI deal. A source said the CLO will likely be in the $300-400 million range and will start warehousing assets in the summer. Octagon is the leveraged loan and high-yield manager subsidiary of J.P. Morgan Partners. Officials at Octagon declined comment and a Bear Stearns CDO banker did not return calls.

BNP Paribas launched syndication last week for Wackenhut Corrections Corp.'s $150 million credit backing the company's purchase of Wackenhut shares held by majority shareholder Group 4 Falck, a Danish security firm. A banker familiar with the deal said investors had oversubscribed the six-year, $100 million "B" loan ahead of the Wednesday bank meeting, but the lead bank was still accepting more investors into the tranche. Price talk for the institutional loan is LIBOR plus 33/4%, while the five-year, $50 million revolver is being shopped at LIBOR plus 3%. The revolver is being offered with an up-front fee of 50 basis points, the banker noted. A BNP official declined to comment.

Centennial Communications Corp.'s home run bond offering lifted the levels on bank debt for wireless names last week. Centennial increased the offering of 101/8% senior unsecured notes due 2013 from $300 million to $500 million, with one trader noting that other wireless companies will be encouraged to tap the market. "Anything wireless is up," said a dealer.

PolyOne Corp., a polymer services company, has completed a $575 million debt refinancing plan to gain access to the liquidity necessary to repay $87.8 million of senior debt due to expire this September, said Dennis Cocco, chief investor and communications officer for PolyOne. Citigroup, PolyOne's relationship bank, led the new deal, which includes a three-year, $50 million revolver, a three-year, $225 million accounts receivable (A/R) sale facility and $300 million of 105/8% senior unsecured notes.

Credit Suisse First Boston is set to lead a credit backing the $1.2 billion acquisition of school yearbook and class-ring maker Jostens. CSFB's private equity fund DLJ Merchant Banking III LP is acquiring the company from Investcorp, MidOcean Partners, First Union Leveraged Capital and Northwestern Mutual Life Insurance. Through the transaction, DLJ will pay $500 million in cash and assume $537 million of Jostens' debt and other securities.

The European arms of BNP Paribas, Barclays Bank, Credit Suisse First Boston and The Royal Bank of Scotland are set to lead a bank deal backing what could be the largest European takeover by private equity firms. BC Partners, CVC Partners and Investitori Associati are buying 62% of the directories business from Italy's biggest phone company, Telecom Italia SpA, for E3 billion, which is equivalent to $3.5 billion. If the buyers are able to buy the rest of the unit owned by other investors, the purchase price could rise to E5.7 billion. The sale of the yellow pages business, called Seat Pagine Gialle, will help shed some of Telecom Italia's E40 billion debt load.

Global Crossing's bank debt stayed at the 21-22 level last week, with sources noting that activity was quieter than usual despite Carl Icahn's offer to buy all the bank debt for 21 cents on the dollar two weeks ago. Some investors holding the paper seem to be banking on this being the first of incrementally higher bids and that this one is too low. It could not be determined if any holders of the debt have taken Icahn up on his offer.

Citigroup held an investor conference call last Wednesday to assuage concerns and get the ball rolling on its $390 million deal for Quintiles Transnational Corp. Several "B" loan investors were dragging their heels, concerned about the potential risk from the company's own investment unit--the PharmaBio Development group.