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Dealers believe that Owens-Illinois will carve out 20% or roughly $500 million of its revolver for a term loan to make the paper more attractive to institutional buyers. Traders said small pieces of the name's revolver and term loan had been moving from dealers to institutions at 97 1/8 and 100 1/4, respectively. An official at the company declined to comment on the rumor noting the privacy of the bank debt.

RCN, the fiber optic services company locked out of the capital markets for the foreseeable future, has struck a deal with its lender group that increases the interest spread on the bank debt and also reduces the overall lending commitment. "RCN will pay down $187.5 million on its term loan, with cash on hand, and will reduce the size of the pro rata," said Kevin Kuryla, director of investor relations. Interest rates will go up to around 6 1/2% to 7% all-in, but that is still comparatively cheap, he added. RCN has been pressured by competition from incumbent digital subscriber line and cable modem providers. In the past year, competitors have been more aggressive in their offerings of high-speed data services, the growth driver under RCN's competitive business model. Last week RCN's bank debt jumped nearly 10 points in about $30 million in trades as the market started to buzz about an imminent paydown (LMW, 3/25).

UBS Warburg has launched a fixed-income and derivatives research portal that consolidates its research across the fixed-income markets. UBS instigated the move to centralize its fixed-income and derivatives trading recommendations in the over-the-counter markets as well as general market comments, said Guillaume Salomon, fixed-income strategist in London.

Source: www.loanmarketweek.com

Source: www.bondweek.com

Alternative Asset Advisors, a Swiss hedge fund manager with USD900 million in assets under management, has structured an equity-linked note that uses over-the-counter equity derivatives. Tony Morringiello, ceo in Geneva, said the five-year capital-guaranteed notes are referenced to its fund of global diversified hedge funds, known as ACE. He referred further queries to officials in the fund derivatives group at BNP Paribas, which structured the deal.

Income Partners Asset Management (HK), a fixed-income fund with USD550 million under management in Hong Kong, is considering issuing its first synthetic collateralized debt obligation in the coming months. The CDO will be structured entirely on Asian credit-default swaps. "We've got the technology to do this in-house," said Francis Tjia, executive director. Income Partners currently has four cash collateralized bond obligations in its investment portfolio, totaling USD400 million, of which two were structured in-house.

AMP Henderson Global Investors, one of Australia's largest asset managers with over AUD66 billion (USD35 billion) under management in Sydney, is considering trading credit-default swaps in Australia for the first time for its AUD25 billion fixed-income portfolio. "We're turning our energies toward credit-default swaps," said Mark Beardow, manager of credit. He added that the fund could invest in credit-default swaps within six months. AMP will consider buying as well as selling protection: "I'm open minded, we'll consider all options and applications," said Beardow.

The San Diego Padres Baseball Club Limited Partnership, owner of the West Coast Major League Baseball team, is considering pulling the trigger on an interest-rate swap following its planed USD150 million debt offering, according to Fred Gerson, cfo. Proceeds from the debt offering, which is expected to hit the market by late April or early May, have been earmarked for the financing of the Padres' new stadium and to build additional infrastructure around the new ballpark, Gerson said. The company is planning to either issue a bond offering on the back of a bank loan it secures for the stadium or go directly to the bond market for the financing.

Citibank and Credit Lyonnais have separately sold what is considered to be the first won swaption-linked notes in Korea earlier this month. "Customers are attracted to the enhanced yield," noted an official at Citibank in Seoul. He continued that the bank is looking to issue additional notes, ranging between KRW100-200 billion (USD75-150 million) in size, either linked to the five or 10-year swaption rates. Officials at Credit Lyonnais confirmed that it also issued similar notes earlier in the month, declining to elaborate.

Computer Associates went ahead with a USD660 million convertible deal last week after bankers came up structured a call spread that helps mitigate the potential dilution of the company's shares through conversion. CA executives had been resistant to the idea of a convertible offering because they felt the company's stock was trading too low. They believed it would probably rebound to higher levels soon and they didn't want a low conversion price to lead to dilution.

Commonwealth Bank of Australia plans to start offering reverse convertibles to clients by year-end. The move is part of the firm's plans to increase its product range as it focuses on premium clients. "We're looking to expand the sweep of products we offer our clients," said Stephen Richards, head of equity trading and risk at CBA in Sydney. Richards estimated it could sell AUD50-100 (USD26.4-52.9 million) within 12 months of launching the product.