Charter Communications bank debt traded as high as 85 5/8 86 1/2 from the 84-85 context on the rumor that the banks were going to be able to negotiate a better position for their exposure to the company. The buzz suggested that due to liquidity concerns the lenders were going to try to force the company to miss April 1 bond interest payments totaling $171.6 million.
One dealer explained that the banks did not want Charter to fund its revolver to deal with the interest payments. But the banks do not have a leg to stand on because the company is not violating any covenants, he added. Traders also said that the bank debt was higher with a general positive sentiment around cable last week, due in part to Adelphia Communications resurgence. Calls to Steven Schumm, Charter cfo, were not returned. A company spokesman said he had no indication that the company would miss the coupon payments.