Adelphia Communications' bank debt traded up last week in front of a Sept. 19 deadline for the bank debt holders to issue a response or file a motion to dismiss the complaint filed against them by Adelphia's Official Committee of Unsecured Creditors. The complaint alleges that bank debt holders knew of, or recklessly disregarded, the fraud committed by the Rigas family, particularly in regard to the co-borrowing arrangements the family had with various corporate credit facilities. When LMW went to press, the banks and the Official Committee of Unsecured Creditors were negotiating a two-week extension to that deadline, according to an attorney familiar with the case. The banks are expected to file a motion to dismiss the complaint, he added.
The company's Century Cable facility was trading actively with the "Century Old" facility changing hands in the 85-87 context and the "Century New" term loan trading in the 831/2 841/2 range. Large pieces of the facilities that do not have co-borrowing relationships traded as well. A $20 million piece of the Frontiervision credit facility is believed to have traded around the 961/2 level and $15-20 million of the Parnassos credit facility was said to have changed hands north of the 941/2 level. Dealers said the company's bank debt was moving up, but one trader explained the name was only stronger due to the general firming of the secondary loan market.