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Dresdner RCM Global Investors will add European telecoms and industrials to its £120 million sterling-denominated credit portfolio. Jamie Stuttard, London-based portfolio manager, says Dresdner will add new issues from France Telecom, which he expects will come with a deal with a sterling tranche this year, if it features a coupon step-up to protect investors from a ratings downgrade. He will add KPN's 81Ž4% of '08, because he views the company as a huge recovery story.

Prescott Crocker, a high-yield portfolio manager with Boston-based Evergreen Investment Management, says he will increase the firm's cyclical bond allocation by $22.5 million, or 5%, based on the assumption that an economic recovery is underway, as indicated by improved commodity prices. He will finance reducing defensive names by $13.5 million, or 3%--as well as energy bonds, by $9 million, or 2%. The manager will buy bonds at a minimum spread of 650 basis points over the curve, while selling at spreads tighter than 450 basis points. Most of the sales will be double-B rated bonds while the buys will target single-B paper. The rotation is duration neutral.

Indiana Farm Bureau Insurance will look to swap out of financials into triple-B utilities on the view that utilities are oversold as a result of Enron-related worries. Bradford Barklay, portfolio manager of $1 billion in taxable fixed-income, says he will look at triple-B names because he does not want to take a large gamble on the sector. He will look to add to holdings of Dayton Power & Light's 6.875% of '11 (Baa1/BBB). Barklay says he likes the company because it is conservatively managed, and, although it is a bit more highly leveraged than other utilities, it had an attractive yield of 205 basis points over Treasuries on Jan. 8. To finance the trade, the insurer will likely sell a five-year Bear Stearns commercial mortgage obligation originated by GE Capital with a 5.06% coupon. Barklay says he will sell the bonds because he believes the three- to five-year area of the curve is vulnerable to underperformance because it did very well in 2001.

Sore sports ... Bank of America, sponsor of the Winter Olympics, is trotting out its employees in televised spots that feature earnest staffers giving their best in skiing and speed skating events. Giving their all, the B of Aers take "Agony of Defeat"-type spills throughout the course but live the dream that is Olympic competition. Still, the painful wipeouts pale in comparison to the grueling endeavor of moving pro rata paper through the market.

This chart, provided by Citibank/Salomon Smith Barney Inc., tracks bid-ask prices for par credit facilities that trade in the secondary market. It also tracks facility amounts, ratings, pricing and maturities.

Dublin-based Goodbody Stockbrokers, the brokerage arm of the AIB Group, is looking to hire a salesperson. Neil Carroll, head of bonds and derivatives products, says the firm wants to grow its product line and client base and will require a new salesperson to do so. Currently, the firm concentrates mainly on government bonds, but wants to expand into credit. Ultimately, Carroll expects to hire credit traders and analysts as well, but the firm will not be pursuing that avenue immediately.

Citibank and Goldman Sachs will launch the eagerly anticipated bank deal for SC Johnson Wax Professional on Feb. 6, and as predicted the pro rata has been trimmed down from $800 million to $550 million. The leads were initially looking at a $400 million revolver and $400 million "A" term loan, but bankers said in the current market, this was ambitious (LMW, 1/21). Citibank and Goldman bankers did not return calls, while Johnson Wax policy is not to comment, according to an official at the company. The new structure could not be ascertained by press time, but a banker said the $500 million institutional tranche has been upped. One banker said, with only about 10 banks interested in the pro rata market right now, the $800 million was always going to be tough. But with LIBOR rates at under 2%, the company is still getting cheap money from the institutional market, he added.

The $2 billion debtor-in-possession facility for Kmart will likely include an institutional tranche, satisfying buyside demand for paper and deepening the prospective pool of capital, bankers said. Price talk on the DIP, led by J.P. Morgan and Fleet Securities, is in the LIBOR plus 31/ 2% range. Credit Suisse First Boston and General Electric Capital will act as collateral monitors, documentation agents and syndication agents on the credit with the two leads. The spokespersons and officials for the banks either did not return calls or declined all comment on Kmart.

The Loan Syndications and Trading Association elected its 2002 board of directors, including Linda Bammann, chief risk officer of BANK ONE, to the position of board chair. Bammann replaces Mike McAdams, who is president and cio of Four Corners Capital Management and will continue on as vice chair of the board. In addition to Bamman, Bob Hevner, managing director and syndication manager at Deutsche Bank was elected treasurer for 2002. Also joining the board for the first time are Glenn Stewart, managing director for syndications at Bank of America and Jon Calder, managing director for sales and trading for Citibank. "The members of our Board of Directors bring experience, leadership and industry knowledge that drive the development of the loan market and the growth of the LSTA," said Allison Taylor, executive director of the LSTA.

BNP Paribas' bank deal for Navis Partners, backing the acquisition of MACTEC from CHB Capital Partners, hit the street running. A banker said some accounts committed to the $140 million, seven-year "B" tranche before the Jan. 18 launch and the "B" tranche is on its way to filling up. The deal also comprises a five-year, $35 million revolver. Pricing is LIBOR plus 4 1/4 % on the term loan "B" and LIBOR plus 33/ 4% on the revolver.

Stephen Penwell, Morgan Stanley's global head of credit research, has been promoted to the new position of head of North American credit sales. He will oversee sales for the firm's investment-grade, high-yield and bank loan businesses. Penwell says it is yet to be determined whether he will continue in his capacity as global head of research, or whether a new global head will be appointed. He says the move is the latest stage in a year-long effort to streamline the organizational structure of the firm's credit business. Last year, Morgan Stanley integrated its high-yield, bank loans, emerging markets and several of its structured product businesses. It also united high-yield and investment-grade research and trading (BW, 8/19).