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Goldman Sachs and J.P. Morgan are preparing a $600 million "B" term loan for Pleasantville, N.Y.-based Reader's Digest Association, backing the $760 million cash acquisition of Reiman Publications. "The entire $760 million payment will be bank debt," said Michael Geltzeiler, senior v.p. and cfo for Readers Digest. "Readers Digest primarily chose to use bank loans to finance the acquisition as it enables us to use the free-cash flows of the combined business to reduce debt levels," said Geltzeiler. This should enable accelerated deleveraging, he said. "Based on the rather favorable interest-rate environment we're looking at LIBOR plus 21/ 2% to 3%," he noted.

Credit Suisse First Boston and Bank of America's deal for Flowserve, which backs the acquisition of Invensys' valve division, is expected to join the club of credits recently oversubscribed, according to bankers. The seven-year, $735 million "B" loan was launched to institutional investors last week and carries a LIBOR plus 31/ 4% spread. A banker explained the "B" backs the $535 million acquisition and refinances existing debt. It could not be ascertained if pricing will flex yet, as the credit has only just been launched, said a banker.

Adelphia Communications' bank debt fell last week with a couple of $2.5 million pieces trading in the 96 range following new reports that the company's off-balance sheet debt may be larger than previously believed. Early last Wednesday, dealers quoted the name in the 95 1/2 97 context. The company also announced that the Securities and Exchange Commission is conducting an informal inquiry into the matter. Calls to Jim Brown, company v.p of finance, were referred to a spokeswoman who did not return calls by press time.

Joseph Philips, an asset-backed securities analyst who specialized in aircraft securitization, has resigned from Morgan Stanley where he worked for the past five years. "We are sorry to see him go, but Joe has decided to leave the business and pursue personal plans," says Chip Schorin, managing director and head of global ABS research. Prior to joining Morgan Stanley, Philips worked in the securitization field for eight years at Salomon Smith Barney.

Indonesian telecoms operator PT Telkom and its partially owned mobile subsidiary Telkomsel are looking to launch $100m deals in the international bond market. Telkomsel will access the market first and has appointed UBS Warburg as the sole bookrunner for a $100m issue. Parent company PT Telkom is likely to follow a few weeks afterwards with a A$150m five year transaction. JP Morgan was announced this week as the winner of a beauty parade.

A spate of new Japanese Uridashi bonds this week demonstrated that while the Samurai bond market remains effectively closed to international bond issuers, Japanese retail demand is still strong - at least for supranational borrowers. Encouragingly, the deals were all arranged using different currencies. The Nordic Investment Bank (NIB) came to market with a dual currency Uridashi bond. Mizuho was sole bookrunner for the issue, which consisted of a $103m 4.55% tranche and a A$134m 5.74% tranche.

Bankers at Credit Suisse First Boston and Citigroup/SSB burst into action on their return from the Easter break, completing Taiwan's largest ever convertible bond issue in 14 hours from the opening of the stock market in Taipei on Tuesday morning. Fubon Financial Holdings' deal secured $3bn of demand as investors snapped up the opportunity to buy into the country's largest financial holding company, diversifying their portfolio away from the electronics sector.

Sole bookrunner Nomura watched Daido Life shares trade up after listing on the Tokyo Stock Exchange this week, to close at ¥301,000 yesterday (Thursday), up 11.5% since their debut on Monday. The performance was impressive considering the gloomy economic climate that prevails in Japan and the uncertainty about the direction of company profits and the stock market.

With market sentiment towards Korean borrowers much improved by Moody's double notch upgrade of the sovereign from Baa2 to A3, observers are looking to see whether Korean issuers will access the international bond market en masse again. Moody's has followed its sovereign upgrade by improving the ratings of Korea Development Bank (KDB), Industrial Bank of Korea (IBK), Export-Import Bank of Korea and Korea Deposit Insurance Corp to the new sovereign ceiling.

* Kommunalbanken AS Rating: Aaa/AAA

Just under 150 deals were closed in other currencies and more than half of these came in Hong Kong dollar. The currency also saw the largest volumes but Swiss franc had an unusually strong week and $406 million was closed off 10 trades. ABN Amro self-led an Sfr300 million ($178.38 million) 10-year deal that pays a coupon of 4% and Landesbank Schleswig-Holstein closed three deals in the currency. The largest was an Sfr150 million three-year note that pays an annual coupon of 3.125%. Issuance in Czech koruna was busy and eight trades were issued. Norddeutsche Landesbank issued one of the largest deals: a Ckr1 billion ($28.21 million) 10-year MTN that was led by Deutsche Bank. The zero coupon trade was issued at a price of 57.53% and will come to the market on April 23 2002. Volkswagen Financial Services closed the weekÆs only Polish zloty trade: a Z100 million ($24.31 million) five-year note that pays an annual coupon of 9% and was led by Morgan Stanley. And European Investment Bank issued the only Norwegian krone deal. The Nkr250 million ($28.31 million) note reaches out to March 2008 and was led by Deutsche Bank. The note offers a coupon of 6.5% and was issued at a price of 101.855%.