Search results for

Jack in the Box completed a new $350 million credit with a reverse price flex and an increase to its first-ever $150 million "B" loan. Hal Sachs, v.p. and treasurer, said the company originally planned for a $125 million, four-and-a-half-year "B" loan priced at LIBOR plus 31/2%. But the tranche was increased to $150 million with a spread of 31/4% over LIBOR. There is also a $200 million revolver priced at LIBOR plus 21/4%, he added. Sachs said 11 banks including lead Wachovia Securities signed into the three-year pro rata piece. The deal replaces a $175 million credit that was due to expire this year.

Two companies seeking amendments to their credits were slogging through the market last week, as lenders held out for better pricing and a larger piece of the proceeds on asset sales. Early in the week, votes were due on amendments for both Broadwing and Wyndham International, but when LMW went to press the negotiations were still continuing.

The bankruptcy court approved Hayes Lemmerz's amended disclosure statement despite the objections of lenders including General Electric Capital Corp., Foothill Capital Corp, Citadel Limited Partnership and Sankaty Advisors, as LMW went to press last week. Officials from GE Capital, Citadel, and Sankaty did not return calls seeking comment. Officials at Foothill could not be reached by press time. Levels for the bank debt remained unchanged in the 82 1/2 -83 1/2 range and Hayes' senior notes are quoted in the 59-61 context.

Market players expect allocations for Crown Cork & Seal's new credit to come out soon and are anticipating the company's $500 million "B" term loan to trade above par. The paper is priced at LIBOR plus 41/4%. The company is currently pursuing a refinancing plan that also includes a $550 million revolver. One trader explained that the paper was likely to trade up because the company had trimmed down its bank debt, so the supply of paper relative to demand is less.

El Paso Corp. continued to be a focus of secondary market players last week as investors and spectators speculated on how the company would deal with the upcoming maturities on its $3 billion, 364-day revolver coming due in May and its $1 billion credit expiring in August. El Paso spooked investors last week when it drew down fully on the August line (LMW, 2/17). The May line is only half drawn and can be termed out for one year. Some market players think that the company will choose to give the bank holders under the May facility extra security in exchange for the extension of that line. Under this scenario, El Paso is expected to draw down on the May credit to repay the August line.

Moody's Investors Service has placed Interstate Bakeries Corp. on review for a possible downgrade following the company's announcement that earnings for its 2003 fiscal year ending May 31 are likely to be lower than previous guidance. The company's $300 million revolver, $375 million term loan "A" and $125 million tranche "B" are currently rated Ba1. The rating agency does not rate the company's $100 million "C" piece maturing in 2007. Paul Yarick, Interstate Bakeries treasurer, said the company is undertaking efforts to address the issues from both a long-term and short-term standpoint.

Owens-Illinois is bringing a $1.5 billion refinancing deal to the market and senior managing agent-level lenders are looking at the credit. A banker familiar with the situation could not confirm structural details at this point. However, a company conference call stated that the facility would include a revolver and "B" piece in the amount that the market would accept. The call noted that the glass container company would do whatever else it needed to refinance the $2.45 billion debt load, for example an additional high-yield offering in dollars or Euros. The refinancing plans are targeted to be complete by the first half of this year. Owens-Illinois refinanced $1.6 billion of its debt in 2002, primarily through bonds.

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.