The bank debt for Wyndham International regained ground as the company got a step closer to completing an amendment that will push out the maturity of the company's increasing rate loan (IRL) to align it with the 2006 expiration on its "B" loan. Market players said both pieces of paper were trading stronger after the company's bank meeting early last week with the "B" loan moving up about two points to the 74 1/2 75 1/2 context. Furthermore, the IRL, which used to trade at about a five-to-six point premium to the "B" piece, is now quoted in the 76 1/2 77 1/2 range. If the amendment gets approved the "B" and IRL essentially become the same piece of paper, one trader said, explaining the convergence between the two pieces.
The plan currently on the table has a little more coming to lenders in terms of collateral and compensation for their cooperation in the amendment. "They've added some bells and whistles to the new deal," said one trader. Lenders will receive an increased spread of LIBOR plus 43/4% as well as a paid-in-kind interest rate feature and a new hotel to back the credit. The company also pledged to hire an advisor to facilitate its asset sales and took steps to assure lenders that earlier maturities would not trip up the company. Calls to Rick Smith, Wyndham cfo, were referred to a spokeswoman, who did not return calls by press time.