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Fabien Pictet & Partners, a London-based hedge fund boutique specializing in emerging markets, is introducing a long/short fund dedicated to emerging market debt. The fund, called GEMs Bond Fund, will start trading next month, says Julian Jacobson, portfolio manager. GEMs is the firm's fourth fund, but the first dedicated to emerging market debt. Fabien Pictet & Partners has $200 million under management.

GMAC-RFC and GMAC Commercial Mortgage are planning large European securitizations this year. GMAC-RFC should be the first to market with a £1 billion residential mortgage-backed securitization. GMAC Commercial is expected to bring out its first European commercial mortgage-backed deal through its conduit program later in the year, say London-based bankers. "In 2002, GMACCM Europe completed in excess of E1 billion in European transactions. Our current pipeline is very strong, and we are very optimistic about 2003. We see securitizations playing an increasingly active role in financing in Europe," says James Dalton, president of GMAC Commercial in Dublin.

Some senior tranches of fixed-rate collateralized debt obligations are trading at significant premiums on the secondary market. Some sell-side analysts say the premiums are caused by the low interest rate environment, and note that the situation is rare because secondary CDO notes rarely trade above par.

The $400 million "B" loan backing the $1.66 billion acquisition of Houghton-Mifflin was a blowout after launching to retail last Tuesday. The tranche, led by Goldman Sachs, CIBC World Markets and Deutsche Bank, was oversubscribed by just under four times. "It's a business that the market was able to understand," a banker said, explaining why the credit did well in syndication. The lead arrangers will cut back allocations to investors rather than increase the size of the tranche, he added. He dismissed reports that the "B" had been reduced to $250 million, with the difference made up through a bond piece. Officials at the lead banks declined comment.

HSBC Bank, a relatively new entrant to the European securitization market, is setting its sights on becoming an important market player. After a slew of hires made last year to fill senior positions on the securitization team, the firm is now looking at garnering a spot on the European securitization league tables, according to Robert Drutman, London-based head of European structured product syndicate and product manager.

A $35 million piece of Xerox Corp.'s revolver, "A" term loan and "B" tranche was auctioned off last Thursday for a combined price of 93 1/2, according to dealers. Bank of Ireland is believed to have sold the paper, but a buyer could not be determined. There was no event that triggered the sell-off, according to market players. Some traders suggested that the price of the bank debt has been climbing up and the bank simply gained approval to sell off the paper. Individually, the revolver has been trading in the low 90s up from the mid-80s. The "A" and "B" pieces are quoted as high as 95-96 up from the low-to-mid 90s levels, where they were trading late last year.

Fleming Companies' bank debt slipped down to the 93-94 range last week as investors grappled with the company's downward-revised fourth quarter earnings estimates and the pressure from Kmart store closings. The paper had been quoted in the 97-98 1/2 range before the announcements. "The bonds got hammered 15 points," noted one trader. The company's 101/ 8% notes were quoted in the 74 1/3- 74 2/3 range when LMW went to press. Fleming revised its fourth quarter earnings to 10 to 12 cents per share, down from its October estimates between 35 and 45 cents per share. "Fleming receives 20% of its revenues from Kmart and Kmart is closing half of its superstores," added one trader. Calls to Fleming officials were not returned by press time.

Banif, one of Portugal's largest banks, is readying its first residential mortgage-backed securitization, according to London-based bankers. The deal, which should be about E500 million, will come to market in the coming weeks and is being lead-managed by Credit Suisse First Boston and Deutsche Bank.

Rumpke Consolidated chose Bank of America to lead its new $110 million credit facility, allowing the company to refinance debt that included a high-interest subordinated piece. B of A replaces incumbent General Electric Capital Corp., partly due to B of A's prominence in the waste industry. "Bank of America is widely known and respected in the waste industry," said Phil Wehrman, Rumpke cfo. In addition, "GECC is considered by some to be a lender of last resort. We thought we would have a better chance of success to fill the facility [with B of A as lead]," he explained. GECC did, however, take on a large exposure to the new credit, he added. Calls to GECC were not returned.

The recent high-yield rally has provided investors with an opportunity to pick up the bonds of Lyondell Chemical Co. at a discount to its peers in the sector, says a sell-side analyst. However, at least one portfolio manager is not ready to increase his allocation to the credit, which is a benchmark issuer in the high-yield chemical sector.

Simplicity Manufacturing has completed its largest credit facility-- for $135 million-- in more than a decade to back its acquisition of lawn mower manufacturer, Snapper, for approximately $56 million. Don Schoonenberg, executive v.p. of finance and administration at Simplicity, a portfolio company of private equity firm Kohlberg & Company, said it's the company's first syndicated facility since the 1980s. Because the lawn mower and tractor maker had much smaller credits in the past, its facilities had been club deals, explained Al Meier, executive v.p. at Fleet Capital, lead bank on the deal. Fleet has been doing business with Simplicity since the early 1990s, Schoonenberg added. The new line replaced a previous $45 million revolver, he further noted.