Search results for

Bear Stearns has won the first portion of a legal conflict withDeutsche Bank over the employment status of a group of three analysts led byMarion Boucher-Soper (BW, 5/27), but the litigation is far from over as Bear Stearns is seeking damages from Boucher-Soper and her two colleagues.

Isle of Capri is planning to use proceeds from a Merrill Lynch-led equity offering to pay down at least $75 million in outstanding bank debt on the company's recently signed senior credit facility. But the equity market placed a bump in the road to execution of those plans last week, as the company's share price dropped from $20 to $16.50. The hit was prompted by the Illinois legislature's decision to raise gaming taxes, and it came despite the fact that Isle of Capri has no operations in the state.John Bakley, senior director of finance, said before the share-price dive that the company is looking to tap the equity markets to take advantage of recent higher valuations on the company's stock to pay down bank debt. "We want to become less levered," he said. He declined to comment after the drop on whether the offering would proceed.

Lombard Odier, which manages £2 billion in fixed-income assets from its London office, has added two analysts in response to growth. Gary Brecknell, who joins from Bear Stearns, will cover financials and Darren Stevens, who joins from Standard Chartered Bank, will cover industrials. Both report to Martin Squires, head of credit research, says Paul Osborne, head of U.K. institutional clients. "As the business grows, we need more credit analysts with specialities," says Osborne of the hires. Lombard Odier, with the addition of Brecknell and Stevens, now has eight analysts covering credit globally. There are no immediate plans for additional hires.

Catherine Smith, a high-yield bond portfolio manager at Wellington Management Co., has resigned after 17 years for personal reasons, according to BW sister publication Money Management Letter. Lisa Finkel, spokeswoman for Wellington, declined to comment, and Smith could not be reached. Christopher Jones, a high-yield bond manager at the firm for just under a decade, has taken over Smith's duties. At last count, Wellington managed about $8 billion in junk bonds. Dan Bryant, cio for the Teachers' Retirement System of Louisiana and one of Wellington's clients, said the firm notified him in advance of Smith's resignation, and that the fund has no plans to replace her. Wellington handles a $128 million junk bond mandate for the plan, as well as a $151 million mid-cap growth mandate.

Merrill Lynch and Bank of America launched and fully subscribed the bank deal for Advanced Medical Optics last week. The loan, which facilitates the spin-off of the business from Allergan, is significant as it is completely new money rather than a re-pricing or refinancing, said a banker. Merrill and B of A bankers declined to comment.

Wyndham International's bond deal was downsized from $750 million to $500 million last week, causing a ripple effect that will prompt the bank debt repayment amount to be reduced as well. Dealers said that the increasing rate loan originally was going to be fully paid down, but now the investors would only get a $239 million payback. The remaining funds will go toward paying down the revolver and anything that is left will go toward the company's "B" term loan. The term loan "B" traded in the 93 range, down from 95, but no trades could be confirmed on the increasing rate loan.

Approximately $10 million of Safety-Kleen's bank debt was said to have changed hands in the 51 range this week after the company got one step closer to selling its Chemical Services Division (CSD) to Clean Harbors. The name has been climbing up from the 32-33 range since the U.S. Bankruptcy Court approved an auction for the sale of CSD in mid-March. At that time, dealers said that all the major trading desks were looking to make trades (LMW, 3/18). Dealers said Safety-Kleen's environmental liabilities and a lawsuit from Laidlaw, which owns 44% of the company, still plague the name.

Last week's move by the Illinois state legislature to raise taxes on riverboat casino operators such as Argosy Gaming, Hollywood Casinos, Boyd Gaming and Mandalay Bay could inspire politicians in other states to push for similar legislation. That would cut into profits of these and other casino operators, says Jacques Cornet, gaming analyst at CIBC World Markets. Many riverboat casino operators have properties in several states.

Telecom Italia's announced debt reduction plans and revised outlook from Standard & Poor's, have analysts touting it as one of the best telecom credits in Europe. Last week, Telecom Italia announced plans to sell its 25% stake in Mobilkom Austria, which should bring in E700 million, and S&P revised the outlook on its credit ratings from stable to positive. "TI is probably one of the best names in the sector along with [British Telecommunications]," says Rick Deutsch, head of European high-grade credit research at BNP Paribas in London. He recommends the company's 61Ž4% of '12, because the steep curve makes the longer-dated paper a better value.

Credit Suisse First Boston and Citibank filled up the seven-year, $375 million "B" loan for Terex and even executed a 1/2% reverse flex to LIBOR plus 2%. The loan refinances debt and backs the acquisition of Germany's Demag Mobile Cranes.

The $145 million "B" loan being led by Bank of America and UBS Warburg for The Columbia House Company will likely be flexed or have some form of tweaking, according to bankers, who said the credit is presenting a tough sell. "It's a B2 credit and so the buyside is looking for a little extra to compensate for some added risk," explained a banker, who predicted a 1/4% or 1/2% flex. The "B" has a current spread of LIBOR plus 41/ 2%, which is 1/2% higher than the now subscribed Herbalife deal.

Approximately $25-35 million of Tyco International's February 2003 bank debt was auctioned in the 94-95 range last Thursday, although some said the market for the name was more accurately represented at the 93-94 level. Market players said the name was moving because investors are anticipating troubled waters ahead and wanted to lower their exposure to the company's paper. The bank debt has fallen from the 94 1/2 - 96 1/2 level, where traders had quoted it last week.