Market players expect that a large piece of Mirant Corp. bank debt, estimated to be in the ballpark of $100 million, will hit the market in an auction. Rumors that the piece was set to auction echoed through the market last week, but no sale ever materialized. An original lender is said to be the seller and the piece is anticipated to be a mix of the company's three revolvers. No one lender holds $100 million of any one of the revolvers, noted one dealer.
One buysider said he did not believe that the large piece would have much of an affect on the price for Mirant bank loans given that the price of the loans often plays off the company's bonds, which are pari passu with the bank debt due to the unsecured nature of both. The bank debt was even quoted a point to a point-and-a-half stronger last week across the three facilities.
The company's revolver maturing in 2005 rose to the 70-71 level, the '04 revolver to the 4748 range and the '03 revolver to the 46461/2 context. A Mirant spokesman declined comment on the possible sale, but noted that the company has recently filed a motion with the court to approve a $500 million debtor-in-possession facility led solely by GE Capital. A hearing to approve the motion is set for the beginning of October.