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American United Life Insurance will invest the cash flow it generates from its insurance business into single-A and triple-B corporate bonds in order to pick up some yield while remaining in the investment-grade credit spectrum, says Kent Adams, portfolio manager with the Indianapolis-based insurance company.

Sell-side energy analysts say investors are overlooking a great buying opportunity in notes issued by WCG Note Trust, a debt-issuing entity created by the Williams Companies and its former subsidiary, the Williams Communications Group. Though coupon payments on the notes are paid by Williams Communications Group, they are backed by the Williams Companies, a natural gas pipeline company. The $1.4 billion 8.25% notes of '04 (Baa3/BB+) were issued in March at 400 basis points over Treasuries and were trading at 370 last week. Slightly higher-rated paper from other pipeline companies such as Enron and El Paso trades well inside those levels. Enron 6.62% senior notes of '05 (Baa1/BBB+) were at 150 over the curve last week and El Paso 8.6% of '03 (Baa2/BBB) was at 140 over. The Williams Companies 7.5% notes of '31, which at a rating of Baa2/BBB- is a notch higher than the WCG notes, were at 215 off.

High-yield paper and forest products sell-side analysts are questioning whether investors went far enough in responding to Doman Industries' (Caa1/B) poor earnings report late last month. One says that though falling pulp prices have hurt earnings at a number of companies, Doman took an even greater hit than many had expected. Doman also failed to capitalize on a strong second quarter for lumber prices. Overall, it saw operating cash flow, as measured by EBITDA, fall by 19.2%, while at Tembec (Ba1/BB+) EBITDA fell by only 8.7%. The analyst expects increased corporate layoffs to slow the number of new homes being built, which will send the price of lumber below the average second quarter price of $503 a ton; that will probably cause a revenue shortfall that would send Doman paper below its current levels. The Vancouver, Canada-based Doman saw its 8.75% notes of' 04 fall from $64 before the earnings call to $59 last week. The analyst says they could go to the low $50's later this year.

Cavanaugh Capital Management may reduce its U.S. Treasury allocation by as much as 8% ($26 million) after the Federal Reserve's Aug. 21 meeting. Megan Brune, a portfolio manager at the Baltimore, Md. money manager, says the firm would look to sell long-term Treasuries if Fed officials and economic data indicate the economy is improving. An improving economy would likely spur investors to transfer assets out of bonds and into stocks, Brune says. She adds that Cavanaugh would probably shift the assets into seasoned mortgage-backed securities with a relatively low prepayment risk, such as Freddie Mac gold pool balloon mortgages.

Investors Management Group, a Des Moines, Iowa manager with $2 billion in taxable fixed-income under management, is preparing to add some 5-7% to its mortgage-backed allocation, taking it from 33% of the portfolio, to nearly 40%. Kathy Beyer, portfolio manager, says the firm recently purchased Ginnie Mae 8% bonds to take its combined MBS and asset-backed allocation to a slight overweight. Beyer says the firm will continue to add 30-year Ginnie 8s if mortgage rates (the Freddie Mac survey of 30-year rates was 7.03% at the time of the interview) climb to the 7.25% range and the economy picks up, diminishing refinancing concerns.

Pitcairn Trust Company will swap 5% of its overall allocation out of agencies into corporates, says Patrick Kennedy, portfolio manager with the Jenkintown, Pa.-based investment firm. Kennedy says he had already begun this trade when spreads widened in June, and that he is looking at completing the rotation if corporate spreads continue to widen by an additional 20-25 basis points.

Brian Rogers, a former high-yield proprietary trader at Credit Suisse First Boston who was dismissed for cause in 1998 for allegedly mismarking a series of long positions on telecom bonds, has reportedly won a National Association of Securities Dealers arbitration against his former firm. A person familiar with the case said an award in his case, Rogers v. CSFB, is currently pending. A spokeswoman at CSFB says that she is constrained from commenting on the specifics of the ruling. She says the firm views the panel's ruling as favorable to CSFB in that it did not say that CSFB either defamed Rogers, or that he was wrongfully terminated. The spokeswoman says that the firm feels it will be fully vindicated at the conclusion of the process. Rachel Glasgow, an arbitration official at the NASD, declined to comment.

Korean financial institutions, active issuers of collateralized loan obligations in their own market, are starting to jump into the U.S. with balance sheet deals to take advantage of cheaper financing.Jerome Cheng, asst. v.p. and structured finance analyst for Moody's Investors Service, said the rating agency is reviewing six dollar- and euro-denominated transactions that are expected to close before year-end, compared to the handful of cross-boarder transactions that have closed in the last four years. Cheng said cheaper interest rates abroad relative to Korea, increased availability of cross currency swaps and interest by U.S.-based financial guarantors to wrap tranches have led to a pick up in the pipeline.

The Barona Tribe of Mission Indians recently landed a $200 million deal to fund the construction of the Barona Valley Ranch Resort & Casino. Andy Laub, executive v.p. financing of consulting firm VCAT, says the funding will go toward the construction of a hotel and casino. In March of 1999, voters in the State of California amended the state Constitution to allow tribes to enter the gaming industry. Laub says the tribe is seeking financing now due to competition from other tribes building gaming resorts. "The market is competitive, and we wanted to get better market share," he said. Gaming casinos must be built on Indian reservations, and since there's a limited number of space, that fuels the competition from various tribes, Laub added.

Market sources said Goldman Sachs' $125 million term loan "B" for Berkshire Partners' buyout of baby clothes producer William Carter was roughly six times oversubscribed before Goldman shut down the tranche early last week. Bankers said Goldman is expected to scale back allocations on the institutional piece of the deal and pitch a flex down on pricing to a zealous buyside. Brad Bloom, managing director at Berkshire, declined to comment on any decision regarding re-structuring or re-pricing the deal. Goldman Sachs declined to comment.

Bull Run Corp. refinanced its credit facility in late July, reducing it to $119 million from $130 million and extending the maturity to July 2002. Frederick Erickson, v.p. finance and cfo, said the company reduced the size of its credit facility because it had paid off outstanding debt. The deal will fund the company's operations. The original deal, signed in 1999, financed the acquisition of Host Communications, a sports marketing business. Erickson said cash flow covenants were "simplified" and that pricing has increased with the new deal as the company experienced a tougher market this time around. He declined to be more specific. Atlanta-based Bull Run, through Host Communications, provides multimedia, promotional and event management services support to universities, athletic conferences, associations and corporations.