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Newcastle Investment Corp., a New York-based subsidiary of hedge fund Fortress Investment Group, is readying a real estate collateralized debt obligation. The $500 million deal, called New Castle CDO II, is jointly led by Bear Stearns and Morgan Stanley. Pricing is set for next week, according to a CDO market participant. Calls to Bear Stearns and Morgan Stanley's CDO trading desks were not returned. Michael Wirth, cfo and treasurer at Newcastle, did not return calls.

Coast Asset Management is prepping Coast Senior Debt Opportunities, a $500 million collateralized debt obligation backed by CDOs, says a CDO market participant. The Santa Monica, Calif.-based asset manager has three CDOs of CDOs outstanding. It has originated one deal every year since 2000. The new deal, underwritten by CIBC World Markets, is expected to price in the second quarter. Calls to Ken Wormser, managing director and head of asset securitization at CIBC, and to Jason Golush, director of CDO investments at Coast Asset Management, were not returned.

CenterPoint Energy is looking for an extension on its $3.85 billion loan facility, maturing this fall, and also wants to delay and reduce two $600 million payments due this year that are required under the current deal, according to sister publication Power, Finance & Risk. With the first $600 million due at the end of this week, the Houston player will likely be right up against deadline, say lenders poring over the paperwork. "It'll be tough to make the deadline," said one banker. Leticia Lowe, a spokeswoman for CenterPoint, said the company is not commenting on the talks with banks.

Bank of America is reworking its $350 million credit for Central Parking because bad news and executive changes at the company have banks calling for a pricing increase and changes in the deal's collateral package. Hiram Cox, cfo of the company, resigned Feb. 14, the same day the company announced an invoicing error that reduced fiscal first-quarter earnings and prompted a stock price decline. The company has said Cox's resignation and the invoicing problem are not related. Lenders are concerned because their deal is secured by the company's stock. A bank meeting was set for Friday afternoon, after LMW went to press, to address possible changes that include a switch to a direct collateral deal and a price hike.

Citibank last week priced the notes for OppenheimerFunds subsidiary HarbourView Asset Management Corp.'s latest collateralized loan obligation, a deal that stands out from the crowd because of the ability of the manager to buy a bucket of deeply discounted assets and the inclusion of reallocation and triple-C haircut tests. The $300 million deal, called Harborview CLO V, allows the manager to invest up to 2.5% of the deal in defaulting assets and 5% in triple-C assets, said Sean Dougherty, an analyst with Standard & Poor's, who added, "The manager believes there is a real value play there." Officials at HarborView and Citibank declined comment, citing the private placement nature of the transaction.

WEEKLY UPDATE

Charles Kinzer, a top Credit Suisse First Boston mortgage-backed securities salesman, and one of the high-profile "group of 40" who almost left for Barclays Capital in 2001, has taken a leave of absence from the firm, said residential MBS group chief Matt Ruppell. Calls to Kinzer's Manhattan residence were not returned. Ruppell says that a decision on replacing him "is a difficult one since he was such a big part of things here. We're trying to come up with a solution as we talk." He acknowledged that Kinzer covered Freddie Mac for the firm, an account that many firm veterans peg as likely the firm's largest MBS revenue producer. Ruppell says the Freddie account had not been reassigned as of last Thursday.

Underwriter Deutsche Bank has priced the notes for Oak Hill Advisors' approximately $500 million collateralized loan obligation called Oak Hill Credit Partners II. The cash-flow deal will be approximately 85% loans with a 15% bond bucket, according to one portfolio manager. The amount of collateral already bought for the deal could not be determined. Officials at Oak Hill declined comment, referring questions to Deutsche Bank. The banker responsible for the deal did not return calls.

Bear Stearns and Merrill Lynch closed the books on Penn National's $800 million acquisition credit, with about 55 accounts signing onto the deal. A banker familiar with the facility said a Feb. 10 price flex as well as some other credit changes led more investors to buy into the facility. The "B" piece was half filled before the changes. Pricing ended up at LIBOR plus 4% on the $600 million "B" piece and LIBOR plus 31/4% on the $100 million revolver and "A" piece for the same amount. There was a 50 basis point commitment fee for pro rata retail commitments above $10 million, while a 12.5 basis point upfront fee was being offered on the "B" loan (LMW, 2/17).

ABN AMRO is creating a new U.S. asset securitization group and has nabbed Jim Moore, who was a v.p. of non financial institutions at J.P. Morgan Securities, to run the group out of New York. Moore, who started last week, will oversee term asset-backed securities, asset-backed commercial paper and mortgage-backed securities. He reports to John Mullen, global head of structured credit markets in London, who declined to comment on the move. Patrick Phalon, a spokesman at ABN AMRO, also declined to comment and Moore could not be reached for comment.

Credit Suisse First Boston and Deutsche Bank are launching this Wednesday a $365 million deal backing plans by Amy Acquisition Corp.-- a Welsh, Carson, Anderson & Stowe company-- to acquire cancer diagnostics provider AmeriPath. The bank duo will be shopping a $290 million "B" piece at LIBOR plus 33/4% and a $75 million revolver. Pricing on the revolver could not be ascertained. The transaction is valued at $839.4 million, including AmeriPath's 2002 debt and an estimated $65.1 million in assumed contingent obligations (LMW, 12/16). CSFB and Deutsche Bank bankers did not return calls.

Fixed-income analysts are divided on how investors should play the bonds of Tyco International following a review of the company's recently filed first quarter 10-Q report. An independent fixed-income analyst is reemphasizing her view that investors avoid the bonds. However, a sell-side analyst argues that, barring a dramatic worsening of the economy, Tyco bonds will trade on a spread basis before year-end. Tyco's benchmark 10-year issue, the 6.375% notes of '11, were bid at 92 last Wednesday. Trading on a spread basis--as opposed to dollar quotes--is usually taken as an indication that high-grade investors are once again actively involved in the credit.