Credit Suisse First Boston posted the winning bid on a $212 million loan portfolio auctioned by Bank of America on behalf of Eaton Vance Management. The wining bid came in north of 101.46, which was the cover bid. As first reported on LMW's Web site last Wednesday, Bank of America approached approximately nine dealers for the sale. The bids on the portfolio were due Friday morning and market participants predicted the bid would be high. Eaton Vance was reportedly going to be bidding for the portfolio themselves. It could not be determined if CSFB flipped it back to the firm, but the market expected it would.
The portfolio includes about 200 credits all in small pieces. Names in the portfolio include Adelphia Communications Corp., Alliance Gaming Corp., Boyd Gaming Corp., Berry Plastics Corp., Charter Communications, Crown Holdings, Del Monte Foods Co., DIRECTV, Graphic Packaging Corp., Jefferson Smurfit Group, Kmart Corp., Noveon International, Oriental Trading Co., Rite Aid Corp., SPX Corp., and TRW Automotive Holdings Corp. "It's a clean portfolio," said one buysider.
Several loan market players expressed a lackluster sentiment before the portfolio sale. Potential buyers worried about working on the deal only to be outbid by Eaton Vance, traders explained. Eaton Vance recently bought General Re-New England Asset Management's $335 million portfolio from J.P. Morgan. The average price of that sale was said to be between 1011/4-1011/2 (LMW, 2/16). Sources speculated that an equity investor in one of Eaton Vance's vehicles was encouraging the sale, necessitating the need for the transaction to be conducted through a third-party at arm's length. Eaton Vance and B of A officials did not return calls by press time.