Search results for

TheLoan Syndications and Trading Association met last week to continue hammering out standard language for assignments, picking up on an initiative started last October. One of the key issues being examined is whether borrowers can buy back their own debt in the secondary market, taking out a position of one lender rather than paying the group back on a pro rata basis.

An $8.8 million chunk of Mariner Post-Acute Health Network's bank debt traded Monday at 54-55, up from the 52-54 context it had been shuffling around in for weeks. The trade occurred in an auction, with Erste Bank rumored to be the seller. "People seem to be easing up on their health care concerns," a dealer remarked. Mariner, based in Atlanta, Ga., is one of the largest providers of long-term care, operating more than 300 assisted living centers. It has filed for Chapter 11 bankruptcy protection, citing low Medicare reimbursements. Calls to company officials were not returned.

Though U.S. corporate bond issuance is on a record pace for the year, Street strategists are showing little concern about this month's supply flood widening spreads. This is primarily because they think issuance will slow down in the second half of the month, which combined withFederal Reserve rate cuts, will keep bonds attractive.

Buy- and sell-side junk pros attribute last week's 4-5 point price drop on cable company United Pan-Europe Communications (Caa1/B-) bonds to concerns over whether the European cable operator will receive the expected E1billion rights issue from its U.S. parent, Liberty Media. Bids on UPC 11.25% of '09 fell from $67.5 to $62.5, after a UPC conference call last Tuesday in which a senior Liberty executive announced that the issue was not finalized, but would be announced in the next five to 10 days. Pros expect the issue to go ahead as planned, returning the price to where it was before the call. They believe Liberty chairman John Malone will prefer the ownership interest that accompanies an equity or, possibly, a convertible deal.

A $60 million piece of Integrated Health Services' bank debt traded last week in the 50 1/2 range, with the seller, reportedly TD Securities, taking a $30 million hit on its position. Traders at TD did not return calls for comment and a spokesman for the bank said he could neither confirm nor deny the deal or the bank's position in the debt. TD is a lead arranger on the company's $2.15 billion credit and was in the paper at par, dealers said. But even with the $30 million punch in the nose, the bank made out much better than it would have just months ago, dealers noted. "It was in the 20s less than six months ago, but they bought it at par," one dealer said. "In the end, they haven't lost as much as they would've."

Trivest, Inc. skipped the "A" tranche on its recently closed $225 senior credit facility to avoid the weak pro rata market. The credit closed earlier this market and backs the acquisition of Brown Jordan International. Bill Kaczynski, managing director at Trivest, says the company opted out of a term loan "A" on the advice of its lead bank, CIBC World Markets. "They advised us to do this to make the credit facility more attractive to investors. It would have the best structure and good execution," he said. "A term loan 'A' typically amortizes after five years, and a "B" is due after six years. It's more patient money at a higher yield." The facility breaks down into a $165 million term loan "B" and a $60 million revolver. It also pays off a $155 million senior credit facility. Trivest is based in Miami and made the acquisition through its affiliate WinsLoew Furniture.

UBS Warburg held a bank meeting for U.S. investors last Friday for a $94 million "C" tranche for Switzerland-based Kaba Holdings. Two weeks ago, the bank meeting for the European section of the loan, denominated in Swiss Francs and totaling $340 million, was held. UBS and Credit Suisse are co-leads.

Bids on Young Broadcasting's bank debt last week were down to 100 1/4, softening from its most recent level of 100 3/8. One dealer noted that the company has yet to issue full-year guidance, which is considered a negative in the market. "The earnings came out and were a little lower than they had been. It's a tough time for [broadcasting], but it isn't going away," a dealer said. The New York City-based company owns 12 television stations across several geographic markets. Earlier this year the company announced a $750 million bond deal which pushed levels into the mid-101 range. Calls to Jim Morgan, cfo, were not returned by press time.

Standard & Poor's hosted its annual CDO/CBO conference at the McGraw-Hill building in New York City last week. Loan Market Week Managing Editor Alison McKiegan and Reporter Pierre Paulden reported the following stories from the conference.

Cleveland-based Geo Specialty Chemicals, Inc. is expecting a price flex down on the "B" tranche of its $145 million credit co-arranged by Deutsche Bank and Salomon Smith Barney. George Ahearn, ceo for the chemical manufacturer, noted that the deal blew out within hours of the bank meeting two weeks ago. The $100 million "B" that priced at LIBOR plus 4%, came in three times oversubscribed, said Ahearn, and the $45 million revolver, with a spread of LIBOR plus 3 1/4%, also filled out. He referred further questions on the potential flex down to officials at the lead banks. Ahearn said he was not surprised by the demand for the credit in a liquid market for "B" loans, after an intimate bank meeting.

Oklahoma City, Okla.-based Dobson Communications is seeking to raise $250 million in the loan market, said Bruce Knooihuizen, executive v.p. and cfo. Dobson is in discussions with several banks about the credit facility, including Bank of America, which was the sole lead arranger and book runner on Dobson's $900 million senior credit facility and on its $300 million senior notes offering last year. Knooihuizen added that Dobson may also look to the capital markets to replace the bank facility after it is secured, but has not yet determined a specific time. The fresh capital will pay for the PCS licenses it purchased at last year's Federal Communications Commission wireless spectrum auction.

First Union, Salomon Smith Barney, Barclays Capital and West LB launched a $3.2 billion credit last week for Allentown, PA-based PPL Corporation. The financing includes a $1.2 billion synthetic lease and $1.1 billion of revolving credit facilities for the holding company, PPL Energy Supply. Each of the four leads has reportedly committed $300 million to the transaction. BANK ONE has signed on as the fifth agent with a $250 million commitment, and Union Bank of California committed $75 million prior to the bank meeting.