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Moody's Investors Service assigned a B1 rating to Rockwood Specialties Group's $570 million senior secured guaranteed credit facility because of the company's high leverage. The credit was launched into syndication this month. Diane Vargas, v.p. and senior analyst at Moody's, said high leverage is the main driver of the rating. "Even without considering the senior discount and (payment in kind) notes, they have very high leverage," she said. The Princeton, N.J.-based company is a global producer of specialty chemicals, including additives, specialty compounds and electronics.

BNP Paribas and First Union's $400 million credit for Hyatt has received approximately $300 million in commitments, including $50 million pieces from First Union, BANK ONE and Firstar Bank. J.P. Morgan Chase, the documentation agent, has also committed $75 million, noted a banker. BNP Paribas is syndication agent and First Union is administration agent for the deal, split between a three-year, $300 million tranche and a 364-day, $100 million tranche. All-in drawn pricing is tied to a grid opening at LIBOR plus 70 basis points. Commitment fees for $35 million and $25 million pieces get 20 basis points and 17.5 basis points, respectively. Officials at First Union and BNP Paribas declined to comment. Calls to officials at Hyatt were not returned.

HypoVereinsbank last week priced a E1.5 billion collateralized loan obligation with a bulked up roster of managers, a strategy that may become more common as CLO investors grow increasingly concerned about the liquidity of CLO paper. "A lot of clients like to see perceived liquidity and more of them are asking for more names," said Chris Tessler, head of institutional sales at HypoVereinsbank in London, explaining why J.P. Morgan, Credit Suisse First Boston, Bear Stearns, and UBS Warburg co-led last week's Gelidilux 2001-1. Tessler said clients are tired of firms buying deals without creating a market for them. He said the balance sheet deal would have been a tougher sell to bond investors without other names on the book and he expects more CDOs and CLOs, domestic and European, to have an increasing number of banks leading deals. Tessler noted that typically a deal the size of Geldilux would have been executed by one or two firms.

Moody's Investors Service has placed Station Casino's ratings on review for possible downgrade, affecting $1.4 billion of debt, including a $300 million credit facility rated Ba1. The potential downgrade is due to leverage concerns and a planned share repurchase agreement of 10 million shares at a cost of approximately $125 million. However, Moody's also noted that Station is one of two dominant players in the Las Vegas locals market and that Las Vegas is one of the fastest growing markets in the U.S.

A National Association of Securities Dealers panel has ruled against Credit Suisse First Boston in several key elements in the case of Rogers v. CSFB. The case centers on issues relating to the alledged wrongful termination of two ex-CSFB junk traders, Brian Rogers and his supervisor, desk chief Sal Abbatiello, in marking over $150 million worth of bonds in 1998 (BW, 8/6). Hearings to determine the amount of damages have yet to be scheduled. Rogers is represented by Jeffrey Liddle, of Liddle & Robinson in New York, who declined comment, citing the upcoming hearings.

Citigroup closed a $350 million balance sheet collateralized loan obligation after notes priced for the deal last week. Bankers said Salomon Smith Barney sold the notes to investors last week to fund the balance sheet vehicle, named Project Securitization Company Ltd. 1. The special purpose vehicle will securitize project finance loans made to the telecom, petrochemical, and power sectors. The portfolio comprises 25 different loans without any one sector dominating the portfolio by more than 10%. A banker noted that only a handful of project finance based CLOs have been structured prior to this deal.

Loans offered at a discount in syndication are popping up more and more as lenders try to appeal to an institutional marketplace looking to make back some of the money it has lost. Original issue discounts (OID) help portfolio managers--particularly collateralized loan obligation managers--push up the average value of their portfolios. With institutional investors claiming the lion's share of new issues, OIDs are expected to gain steam, bankers said. "The trend is likely to continue," said Richard Carey, managing director at Credit Suisse First Boston. "The fastest growing segment of the institutional loan market is the CLO portion, and original discounts cater to their appetite."

Fleetwood Enterprises closed a $260 million deal late last month to replace notes, pay down other debt, and to finance operating expenses. Boyd Plowman, cfo, says this is the first credit facility of this size for the company, which had used $69 million in long-term notes before the refinancing. "We foresaw some covenant violations, and it came to fruition," Plowman explained, noting that the covenants on the bank deal are less restrictive. The Riverside, Calif.-based company is one of the leading distributors of recreational vehicles and manufactured homes.

A pair of sell-side analysts say Lucent Technologies' bondholders are too optimistic in the wake of that company's much discussed $1.9 billion convertible preferred offering. Basil Chaltas, portfolio manager at Lincoln Capital Management in Chicago, says he likes the deal because it provided the company with more financial liquidity while protecting the place of straight bondholdes within the capital structure. Still, Chaltas says he did not add to his position over concerns about Lucent's business plan. Last Thursday, the Lucent 7.25% notes of '06 traded up to $86. On July 30, before the deal was announced, they were at $80.

A $40 million chunk of Comdisco's bank debt traded last week as the bidding process for some of the company's assets drew objections from bidders. Deutsche Bank was rumored to be the buyer of the block, snapping it up in the mid-80s. Deutsche Bank officials declined to comment. Dealers said the wrangling over Comdisco's assets should translate into higher prices when they are sold. "It means more competition and makes the price go up, so it's a good thing," noted a market player.

The $100 million credit for Itasca, Ill.-based PrimeCo Personal Communications, led by Barclays and J.P. Morgan Chase, was filled last week, but only after pricing was jacked up 50 basis points to LIBOR plus 41/ 2%. Bankers familiar with the deal said original pricing of LIBOR plus 4% was considered tight and that progress was sluggish until the flex. Officials at Barclays declined to comment. The other banks that have signed up could not be ascertained. PrimeCo did not return calls.