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Two par name staples bounced around last week, dropping early and then recovering late in the week. Nextel Communications traded down to 88 from 89 1/4-90 1/2 in a small $2.5 million trade Wednesday. But by Thursday, Nextel began to climb to 88 3/4 early in the day and later $2.5 million traded at 89 1/16. Another $5 million of Nextel traded at 89 1/4 in the late afternoon, said one dealer.

The Houston Texans will be looking for a lead bank for a possible $300 million refinancing in the form of either a bank deal, a private placement or a combination of the two by next year. J.P. Morgan leads the current $225 million bank facility, but the Texans need an extra $75 million to pay the National Football League next January, and according to Scott Schwinger, cfo of the Texans, the debut season would be a good time to extend the maturity on the existing debt. "J.P. Morgan has a strong seat at the table, but we will talk to other folks as well," stated Schwinger.

Patriarch Partners, a New York-based distressed bond investment management boutique, is strengthening its structured finance effort and has hired three collateralized loan obligation analysts for this purpose. All new hires take newly created slots, according to Lynn Tilton, principal.

Deutsche Bank and Credit Suisse First Boston's $1.25 billion deal for PanAmSat is on the cusp of filling up and allocations are expected this week after a strong bond offering kick started the syndication. One banker noted half the deal was spoken for before the bond offering, but the pricing of the bonds provided a pointer to the relative value in the bank debt and a subordinated cushion, enabling cautious buysiders to commit. Some investors were waiting to see what would happen with the bonds before committing, said the banker.

Roughly $20-30 million of Pacific Gas & Electric's bank debt traded above par last Thursday, creeping up from 97-98 after the market digested an 8-K filing from the company that included an accrued interest provision on its existing debt. Traders said Deutsche Bank and Merrill Lynch were involved in the trades. Levels on the debt reportedly climbed to the 101 1/2 102 1/2 range on the letters of credit and the 101-102 range on the revolver. Traders explained the surge in the debt levels came from optimism surrounding an expected approval of a provision in the company's Chapter 11 reorganization plan that would give Class 5 General Unsecured Claims accrued interest on their investment. "The claim is fully covered, you're not going to take a discount on your principle," explained one trader. Officials at Deutsche Bank and Merrill declined comment.

Last weekFitch Ratings downgraded two tranches of the liabilities of Pilgrim Investments' collateralized loan obligation, Pilgrim CLO 1999-1, removing them from credit watch negative. A $60 million class B tranche has been downgraded from BBB+ to BBB- and a $10 million class C tranche from BB+ to BB-. Michele Zacharias, analyst at Fitch, said the current downgrade reflects increased levels of defaults and deteriorating credit quality of underlying assets.

Shoney's replaced Bank of America and other lenders on a $135 million credit for its subsidiary Captain D's with a private equity fund that is hooking up with the company.Lone Star Funds has a merger agreement with Shoney's pending and the fund has taken out the bank debt as part of the union. The fund's new role as lender on the credit, which was given an extension by banks until March, eliminates Shoney's plans for a bond deal to take out the debt originally set to mature in December 2001. Shoney's, under pressure from banks and rating agencies, had been considering a bond deal heavily backed by Captain D's assets to raise capital to pay down the line. "We were looking for longer-term financing and then there was a change of plans when [Lone Star] came in," said Ernie McDaniel, Shoney's treasurer. Calls to officials at Lone Star Funds were not returned.

Deutsche Bank and RBC Capital Markets have landed lead roles on an underwritten credit facility backing Petro-Canada's C$3.2 billion (USD$2 billion) acquisition of the international oil and gas operations of Veba Oil & Gas from Veba and BP. A banker familiar with the deal said the two banks are looking for co-arrangers for the C$3.5 billion loan and general syndication is slated for next month.

XL Capital Assurance, the New York-based asset-backed securities guarantor, has hired Steven Katz for a newly created position as a director in its credit group. Katz comes from Woodcliff Lake, N.J. based buy-side fixed-income manager Seix Investment Advisors. Katz will do credit research on diversified financial companies, with an emphasis on auto-finance and home-equity companies, two of the largest sectors within the ABS market. He will report to Patrick Mathis, senior managing director and chief credit officer who heads the five-person credit team. Katz says he made the move because he wanted the opportunity to expand his credit expertise within a smaller company atmosphere.

Allied Irish Bank has hired Vaughn Buck, a project finance pro from NRG Energy, to bolster its emerging project finance team in North America. AIB has been operating for a while in Europe, but the project financing capabilities are being extended to the U.S., said Paul Carey, director, corporate banking for AIB in New York. The recently established team of 12, set up about a year ago, concentrates on acquisition finance, leveraged finance, and is moving up in project finance, he said. AIB has already participated on some deals, but is indicating a long-term commitment to the market, while the sector is facing some short-term problems, he said.

The AIB move coincides with a round of cuts at Bank of America's project finance department. Charlotte-based Brian Goldstein, head of U.S. project finance, London-based Parker Knight, head of international finance, Hong Kong-based John O'Neill, responsible for Asian project finance and several bankers associated with Enron have been let go by the firm. One banker said the departure of key personnel such as Dennis Magna and Jerry Stalun to Duke Capital Partners last year marked an important point, as they were never replaced. It looks like B of A is merging project finance into the loan syndication group, said one banker, noting the high costs associated with a separate group.

Barclays Capital Asset Management is in the market buying up assets for a new $300 million collateralized loan obligation. The deal, right now referred to in the market as Venture CLO, will be backed with 90% senior secured leveraged loans and 10% high yield bonds. Hans Christensen, portfolio manager at Barclays, declined to comment on the transaction. Underwriter Credit Suisse First Boston is reportedly beginning the marketing process on the deal this week with plans to price notes for investors in roughly three weeks. Officials at the firm declined to comment.