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Credit Suisse First Boston is once again the far and away leader in terms of volume of high-yield issues managed since 1998 that subsequently defaulted, according to BondWeek's third annual Turkey Tables. Morgan Stanley and Goldman Sachs moved up considerably, due mostly to the tremendous number of defaults this year.

Credit Suisse First Boston is once again the far and away leader in terms of volume of high-yield issues managed since 1998 that subsequently defaulted, according to BondWeek's third annual Turkey Tables. Morgan Stanley and Goldman Sachs moved up considerably, due mostly to the tremendous number of defaults this year.

The calendar picked up again, with about $20 billion in dollar issuance hitting the investment grade, high yield and emerging markets. The highlight of the week was the AT&T jumbo deal, which was the second largest U.S. corporate bond on record. AT&T doubled the deal size to $10 billion in the face of strong demand from U.S. investors reaching for yield given the gap down in Treasury yields since the suspension of the 30-year auctions. The 10- and 30-year tranches were each $2.75 billion in size and reportedly had books behind them of over $10 billion each. The 30-year bond, which priced at +295 bp to Treasuries tightened about 20 bp on the break. The 10-year tightened about 15 bp. Overall, the market seems in very strong technical position with significant pools of cash to be put to work in both Europe and the United States. The decline in the 'war' premium given the successes this week in Afghanistan has also underpinned spreads.

Dal-Tile closed a $400 million refinancing deal in late October, securing a smaller deal and eliminating its "B" tranche. "We're paying down our debt fast. We used a term A and a revolver because it gives us flexibility to pay down our debt," said Chris Wellborn, cfo. "A 'B' tranche is longer term; you pay more to have it sit there. We didn't need the long-term financing." The new credit breaks down into a $125 million "A" term loan, a $200 million revolver, and a $75 million accounts receivable securitization. "We wanted flexibility and we wanted financing to fund organic growth of the business," said Wellborn. Dal-Tile, based in Dallas, is a manufacturer, distributor and marketer of ceramic tile.

Enron subsidiary Eott Energy Partners, a lease crude purchaser and marketer of crude oil, is seeking a new $300 million revolving credit facility that includes letters of credit to replace a line provided by Enron. Susan Ralph, treasurer, explained the Enron line is $1 billion, but the company does not need a facility of that size. She declined comment on how the market is responding to Enron-related credits and would not name the banks leading the deal. One banker said ING Barings is the lead, though Ralph would only confirm it is one of the banks participating.

High-yield analysts and portfolio managers on the buy- and sell-sides expressed disappointment about the recent $150 million bond issue by ResCare (B2/B), a provider of services for mentally handicapped people. The 144a private placement carried a 105/8% coupon and priced at par. Last Thursday it was trading at 101. "It's the first healthcare issue that's not on fire after issuance," says a sell-side analyst, "I'm frankly surprised they got it done at all." One New York buy-side analyst, who did not buy the deal, concurs. "Usually when a new deal breaks, I get 15 Bloombergs [messages from traders indicating buying interest and price levels]. This time, I got two."

Investors in four collateralized debt obligations managed by Credit Agricole Indosuez are eyeing the possibility of voting on a move to switch the business over to Royal Bank of Canada to keep the deals managed by former managers who recently departed the firm. The potential shift is one bone of contention in a lawsuit filed by Indosuez against RBC and the team it hired away from Indosuez. Dan Smith, Lee Shaimen, Ken Kencel, and Michael Arougheti left Indosuez Capital for RBC last month. Market sources said investors are beginning the voting process on Indosuez Capital Funding IV, Indosuez Capital Funding VI, Porticoes Funding, and Serves 2001-I Limited as all four of the deals have triggers for management changes built in. Paul Travers, managing director at Indosuez, did not return calls regarding a change in managers. Smith declined to comment.

J.P. Morgan is looking for institutions to re-commit to a reverse flexed term loan "B" for Compass Minerals after being twice oversubscribed last week. A banker said the $275 million term loan "B" has been cut to $225 million with the spread trimmed 1/2% to LIBOR plus 31/ 2%. The bond deal has been upsized to $250 million. J.P. Morgan officials and a spokesman did not return calls. Deutsche Bank is the syndication agent and Credit Suisse First Boston is documentation agent.

Approximately $50 million of Global Crossing paper traded last Wednesday following a conference call that reported a dramatic earnings loss and the likelihood that the company will soon break a covenant in its loan agreement. Dealers reported a failed auction of $30 million where the prospective seller was reportedly asking in the high 30s. "People were not willing to bid up on the price after the company came out with bad numbers [Wednesday]," a dealer said. "It looks bleak, and the price reflects that."

J.P. Morgan and 17 other lenders are facing off in the New York Supreme court on Nov. 19, over claims the banks were fraudulently induced by Motorola and Iridium to enter into a credit agreement. Questions to Motorola officials were referred to Scott Wyman, spokesman for Motorola, who explained that after Iridium went bankrupt, the J.P. Morgan workout team went after Motorola, which "wholly disagrees on the case." Calls to the J.P. Morgan press office were not returned.

NationsRent's bank debt traded down to 45 early last week from the mid-60s following an announcement by the company that it was not in compliance with certain loan covenants. Dealers say the credit has been quoted down consistently over the last six months, in line with a slowing economy, and that this was the first trade. The last trade reportedly was at 70 about six months ago. "It's slowly crept down with the economy really stinking. It's a very cyclical business," said a market player. The Fort Lauderdale, Fla.-based company rents out construction equipment. Calls to Ezra Shashoua, cfo, were not returned. Further calls were referred to a spokeswoman, Jaquelyn Cortez-Walker, who also did not comment by press time.

UBS Warburg's $190 million bank deal backing Investcorp's acquisition of Netpune Technology Group from Schlumberger has received a positive reception from investors, with UBS aiming to wrap up the "B" tranche before Thanksgiving. Launched at the Waldorf Astoria two weeks ago, the meeting was well attended, said a banker, adding better bids in the secondary market are a good sign the market is turning. As Loan Market Week went to press, ratings were to be assigned. The banker said, "Four-B ratings are expected and once the ratings are out, the term loan will be wrapped and packed."