Search results for

Charter Communications' debt softened to 99 3/8 in a $2.5 million trade last week. Dealers say rumors of more cable paper pushed levels down. It could not be determined which firm traded the piece. Dealers believe another cable deal is in the pipeline, although specifics could not be determined. "It's either Charter's doing a new deal or another cable company," a trader speculated, regarding the expectation that an increase in cable paper may be on the horizon. Charter, a cable systems operator with more than six million subscribers, is based in St. Louis, Mo. Another dealer noted that Comcast's move to buy AT&T may also flood the market with additional cable paper.

A $15 million piece of Comdisco's bank debt traded on Tuesday in an auction. Deutsche Bank was rumored to be the buyer, and Citibank was reportedly the seller. Officials at both shops would not comment. Exact levels could not be ascertained, although the market for the credit is said to be 80-81. Comdisco, based in Rosemont, Ill., is a technology services provider. A company spokeswoman declined to comment. "We don't comment on market rumors," she said.

Credit Suisse First Boston and National City Bank held a bank meeting July 25 for Cleveland-based chemical company Ferro's $900 million credit. The loan backs the $540 million acquisition of dmc2, OM Group's electronics materials, ceramics and pigments operations. It also refinances debt. The package consists of a $200 million, 364-day revolver that carries a 3/8% commitment fee, a $400 million, five-year revolver that has a 1/2% commitment fee and a $300 million six-month bridge loan. The out-of-the-box spread is LIBOR plus 2%. CSFB is the syndication agent and National City has the administration role. The credit is rated BBB-/Baa3. Officials at CSFB and National City did not return calls.

Responding to difficult times in the pro rata market, Deutsche Bank came to investors last week with an innovative $150 million synthetic term-loan, functioning as a fund to back letters of credit for Premcor Refining Group, but structured to bring institutional dollars into the $500 million pro rata part of the deal. The tranche is the first large-scale synthetic to meet letter-of-credit requirements. Jeff Ogden, managing director at Deutsche Bank, explained "the structure is fairly unique to Premcor, which has a large letter of credit need, but could be used for other companies with significant letter of credit requirements."

The two major ratings agencies have seen a sharp spike in employment inquiries in recent weeks, with many coming from the biggest users of their information: The New York dealer community. Brian Clarkson, asset finance group chief at Moody's Investors Service, says he is getting more resumes and calls than ever before from Street bankers seeking ratings analyst positions. Clarkson received 500 resumes recently from an ad Moody's placed in the Wall Street Journal, 50 of which came from people at different levels of investment banking. "We used to get only a few inquiries from bankers, but with the recent downsizing seen on the Street, we get more and more of these calls everyday," notes Clarkson. "This is a higher than usual ratio," he notes.

Vertical Crossings, the New York-based structured-product electronic trading network, has added John "Chip" Montgomery, the former director and national sales manager of high-grade products at SG Cowen. Montgomery left Cowen in 2000 and joined wireless trading application provider SmartServ Online, where he was in charge of global sales and business development. He was unavailable for comment, and a spokesman for SmartServ did not return a call seeking comment. His position is newly created, and he will be responsible for expanding VCross' institutional customer base, either via facilitating telephone-assisted trading, or selling the electronic trading platform itself, according to Steve Beck, executive v.p. Montgomery, who will be a v.p., will be based in New York and report to Pat Downes, president, and Beck.

Lehman Brothers has recruited Drew Nugent from Fitch as an associate banker in its asset-backed securities financial group, according to Nelson Suarez, managing director, who heads Lehman's ABS banking division. Nugent, who will directly report to Suarez, was unavailable for comment.

Noting the stellar stock performance of a number of gaming companies, fixed-income analysts say new equity offerings could be forthcoming, which may well increase investor sponsorship in an already hot sector. Andrew Zarnett, gaming analyst at Deutsche Banc Alex. Brown, says that funds raised via equity sales would probably be used to pay down bank debt and deleverage, making their bonds tighten further as cash flow and financial flexibility ratios increase. Though the sector has performed extraordinarily well, Jacques Cornet, gaming analyst at CIBC World Markets, believes new equity deals could cause another 25-50 basis points of tightening in what has already been a tight sector. Gaming yields were 504 basis points over Treasuries last week, in from 588 at the end of March, though slightly wider than the 483 over on June 30, according to Merrill Lynch indices.

Gruntal & Company closed its proprietary high-grade corporate bond trading desk in New York last Thursday and dismissed 30 corporate bond salesmen, traders and support personnel, according to BW sister publication Wall Street Letter. Consequently, the firm will cease making markets in fixed-income products. The move was first announced Wednesday night in an internal e-mail, and Henry "Hank" Gottmann, the president of the firm's private client group, elaborated on the plan in a conference call last Thursday morning to branch managers. Gottman could not be reached by press time.

Heller Financial Asset Management is looking to buy up assets for a new $400 million collateralized debt obligation with slated collateral for the deal comprising roughly 90% leveraged loans and 10% high-yield bonds, said bankers familiar with the deal. The vehicle--West Loop CLO 1--is reportedly structured as a cash flow, arbitrage deal whereby the manager profits from the arbitrage between the spread generated by the sale of notes funding the deal and the spread paid on the assets. Linda Wolf, portfolio manager at Heller, confirmed the manager was in early stages with the CDO, but declined to comment on when it would close or the projected time for issuance of the liabilities. The trustee for the transaction could not be determined by press time. CIBC World Markets will underwrite the notes supporting the deal. A spokesman for CIBC declined to comment.

Highland Capital Management is in the process of closing a $500 million collateralized debt obligation after underwriter Salomon Smith Barney issued $458 million in notes two weeks ago to fund the vehicle. Bankers close to the deal said Highland had been holding off closing the deal in hopes of ramping up additional collateral which would upsize the vehicle to roughly $600 million. "They changed their minds and decided to get it out the door," said one banker. Officials at Highland did not return phone calls by press time.

Irving, Texas-based FelCor Lodging Trust has inked a $500 million loan facility commitment from J.P. Morgan and Deutsche Bank in connection with the financing of its $2.7 billion acquisition of MeriStar Hospitality. The loan, which has not yet been priced, will be used to fund the purchase of MeriStar's senior notes that are due in 2008 and could be put back to the company once the merger is complete in the fall, explained Stephen Schafer, director of investor relations for FelCor. The $2.7 billion deal will be financed through $1.1 billion in stock and $1.6 billion in assumed and refinanced debt.