Search results for

CIBC Capital Markets and Antares Capital have joined Deutsche Bank's $100 million deal for Aquila Power Services, a portfolio company of private-equity firmFirst Reserve. The deal, which comprises a five-year, $25 million revolver and a $75 million five-and-a-half year term loan, partially backs the acquisition of Welding Services, said a source familiar with the deal. The tranches carry an out-of-the-box spread of LIBOR plus 4%.

Deutsche Bank's $700 million credit for Williams Scotsman is backed by collateral that will provide substantial recovery for bank debt holders in a default scenario, according to Moody's Investors Service, which has placed a B1 rating on the credit. The deal is currently in the market and GMAC Bank and Congress Financial have signed on as co-documentation agents committing $50 million each, according to an official close to the syndication. The credit comprises a $500 million, five-year revolver and a $200 million term loan "B" both priced at LIBOR plus 3%.

A yo-yo round of pricing changes on the $350 million Express Scripts term loan "B" had investors running to then from the deal before pricing finally settled at LIBOR plus 2% last week. A rousing initial response had agentsCredit Suisse First Boston and Citibank looking to cut pricing for the company from LIBOR plus 21/ 4% down to 13/ 4%. But they went too low and investors began to walk. "Obviously at LIBOR plus 21/ 4% it was very well oversubscribed and in our discussions with Citi and CSFB we determined that the market might have enough appetite at LIBOR plus 13/ 4%," noted Darryl Weinrich, v.p. and treasurer of Express Scripts. "But, we could not get enough in at this price so went back to 2%."

The Financial Accounting Standards Board is pushing for companies to count their trust preferred securities as debt on balance sheets, a move that could significantly shift the debt ratios of some companies and lead to potential covenant defaults. FASB is taking aim at the mezzanine section of the balance sheet as part of its equities and liabilities project, and trust preferreds typically reside there.

Nick Waltner, managing director and head of equity financial products at Bank of America in Tokyo, has quit and plans to set up a hedge fund in the U.S. "It's time to move on," noted Waltner, after working in Japan for nine years. He will head back to Seattle to start up a quantitative relative value strategy fund, dubbed Kulshan Asset Management, by next fall. Kulshan is the native American name for Mount Baker, a well-known mountain outside of Seattle. "We'll start small and first establish a track record," he noted.

Goldman Sachs plans to hire two convertible bond arbitrage traders to expand its proprietary trading desk to London. At the moment the firm only has proprietary traders in New York, according to an official familiar with the move. He added Goldman expects to have the convertible bond prop desk up and running by year-end.

Commerzbank this week launched Sanwa Finance Co's securitisation of ¥25.4bn of unsecured Japanese consumer loans. Originally planned as a euro transaction, SF Funding One SPC was finally sold in dollars and yen after four to five weeks of marketing. Investors are wary of Japanese risk and did not respond positively to an offering from what is only the 14th largest consumer finance company in Japan.

Taiwanese dealflow got back up to speed this week as Elitegroup Computer Systems, the country's largest motherboard manufacturer during 2001, completed a $100m zero coupon deal through UBS Warburg. Elitegroup stock has tripled in value in the past year, giving the firm a market capitalisation of roughly $1.7bn.

The Hong Kong Mortgage Corp, the government agency set up to develop a secondary mortgage market, launched the first issue from its $3bn mortgage securitisation shelf last Friday. Lead manager Merrill Lynch, which had structured the Bauhinia MBS Ltd programme, found strong demand from Hong Kong banks, insurance companies and pension funds for the bonds.

Investors queued to buy Patrick Corp's 17.4m new share issue at A$14.90 per share this week through JB Were, after the company took a 50% stake in Virgin Blue, Richard Branson's Australian airline. Patrick Corp, formerly known as Lang Corp, is Australia's premier port cargo handler. The placement was initiated on Tuesday, when Patrick announced it planned to raise A$260m through a placement, underwritten at A$14.20. That was a 10% discount to Monday's closing share price of A$15.70, an all-time high for Patrick. The deal took place at A$14.90 per share, a 5.1% discount. By yesterday (Thursday) afternoonthe stock was trading at A$16.43, up 10.3% from the issue price.

Japan Retail Fund Investment Corp, the third Japanese real estate investment trust, fell 4.9% on the first day of trade on Tuesday. The units fell to ¥447,000 from their offer price of ¥470,000. In early trading, there were no bids, only sell orders. Yesterday (Thursday) afternoon, they were quoted at ¥644,000. The result is discouraging for the nascent REIT industry in Japan. In this case, the company's assets comprise four retail shopping centres with an appraised net asset value per share of ¥490,000, which should therefore leave little downside potential for the stock, especially since it has been priced with an enticing 5.8% yield in a market that boasts extremely low yields and thin spreads.