Search results for

Credit Suisse First Boston is using a synthetic term-loan structure in its deal for Washington Group, further highlighting the continuing shrinkage of banks willing to fund the pro rata part of deals and the increasing importance of institutional money in the market. The deal is similar to the innovative Premcor Refining Group credit launched by Deutsche Bank in the summer, with the synthetic functioning as a fund to back letters of credit. "The structure is designed to expand the universe of institutions able to sign onto the deal," a banker familiar with the loan said.

Moody's Investors Service has assigned a Ba3 rating to J.P. Morgan and Credit Suisse First Boston's credit for CSK Auto--a new asset-backed credit facility, launched into the market at the end of November. Marie Menendez, v.p., senior credit officer, corporate finance group for Moody's, explained the $100 million term loan with three-year bullet maturity and $225 million revolver is totally secured and tied to a borrowing base, while the existing credit facility has a B1 rating. The new credit is larger and expected outstanding borrowings on the new credit are much less. A $225 million senior unsecured notes offering, has been rated B2.

A successful bond offering led by Credit Suisse First Boston, J.P. Morgan andUBS Warburg for CSK Auto has resulted in a reduced and restructured bank deal. The bank debt, led by J.P. Morgan and CSFB now consists of a three-year, $150 million revolver and a $150 million, three-year term loan. Both tranches now have a LIBOR plus 31/ 2% spread, up 1/4%. There is also a 1/2% commitment fee on the revolver. The bank debt previously was $325 million, split between a $225 million revolver and a $100 million term loan. Calls to Don Watson, cfo, were not returned. There is also rumor that CSFB, J.P. Morgan, Deutsche Bank and Merrill Lynch will rework the Collins & Aikman deal, depending on a successful bond offering. Calls to the appropriate bankers were not returned by press time.

Merrill Lynch has laid off two junk salesmen: Jeff Keith, a director, and Gregory Froehlich, a v.p., according to several buy-side and sell-side high-yield executives who spoke with them. Keith declined comment, other than to say he is currently looking for a new job. Froehlich could not be reached.

The relocation of a swaps trader from Nomura Securities International to Greenwich Capital Markets has set off a bit of a sniping match between the trader and his former boss, Nomura's fixed-income chief Alex Noujaim. The trader,Becker Drane, took Noujaim to task in his letter of resignation when he left in October. Noujaim responded by calling Drane's new boss, GCM co-president Jay Levine, and reportedly criticized Drane and the letter he wrote upon his October exit.

American Tower's debt is rebuilding in the market, hitting 96-98 from the 94 range. There was a report of a $2.5 million trade in the 96 3/8 range late Tuesday. One dealer attributed the support in levels to technicals, but said the outlook on telecom credits remains mixed. Tower credits recently stumbled in the aftermath of the telecom problems and lowered projections on the use of tower space. The Boston-based company operates 13,600 broadcast and telecommunications towers. Joseph Winn, cfo, has said demand for the company's towers has been solid. He did not return calls for comment on the latest levels.

UBS Warburg is preparing a January launch for syndication of a credit for Hollywood Entertainment, the second largest video store chain in the U.S. A banker said the loan will refinance the existing $255 million Société Générale-led credit facility that expires next March, and is contingent on a $100 million common stock sale. Diane Shand, analyst at Standard & Poor's, said the company needed to refinance since it was facing a heavy amortization schedule on its existing facility. The video-store company is also planning a $300 million shelf registration to reduce debt, she said.

Moody's Investors Service lowered the rating of Penton Media's $372 million of credit facilities to B2 from B1 due to the company's poor operating performance. The severity of a revision in cash flow guidance and the proximity of the revision to previous modifications led Moody's belief that management's visibility is severely limited at the present time, which remains a large concern for the rating agency.

About $7.5 billion of investment grade corporate bond supply hit the market for the week ended December 13, with the $3.75 billion two-tranche Verizon Wireless deal accounting for half of the flow. It looks as though the corporate bond market will end the year with close to $600 billion of debt issued, about 50% more than 1999's then-record pace of $400 billion. The weighted average credit quality for the week dropped to BBB, its lowest level in months as high yield syndicate desks rushed to bring deals into a hot market. About $3.3 billion in junk bonds were brought to market, with a high concentration ($2.5 billion) of single B names. In fact, over _ of total issuance for the yield was single B rated, the first time this year that high yield has been such a large proportion of total issuance. Total high yield issuance for the year is likely to end up around $90 billion, over 2.5 times issuance last year although still well short of 1998's record pace of $140 billion.

Adam Tashman, Merrill Lynch's senior collateralized debt obligation analyst, was recently laid off according to a structured finance executive at the firm. Tashman's official title is senior specialist in the high-yield strategy department, and he focuses almost exclusively on CDOs. He reported to Brian McManus, a first v.p in high-yield strategy who heads Merrill's CDO research. McManus declined comment. Tashman's voicemail at Merrill says that he is no longer working with the firm and calls were referred to McManus' extension. Tashman could not be reached for comment. With Tashman's departure, McManus is now the only analyst listed for CDO coverage at Merrill.

BMO Nesbitt Burns, SunTrust Bank and Scotia Capital are eyeing a mid January return for the "B" term loan for Canadian door manufacturer Premdor. The pro rata portion of the deal was oversubscribed, said Surjit Rajpal, executive managing director with BMO, but the "B" did not fly with investors post Sept. 11. "There was expectation there would be changes," Rajpal said, but lead arranger BMO decided to put the credit on ice until conditions in the loan market improved, rather than use the techniques available to make the deal more saleable, as seen on CommScope and Appleton Papers.