The market was buzzing last week over a plan for Allied Waste Industries that would likely refinance bank debt. In anticipation of the potential move, the company's "B" and "C" tranches have firmed, trading up as high as 99 2/3 to par from 99-99 1/2 earlier this year. Market players are anticipating that a plan in the making could possibly include a $1.5 billion term loan, a new revolver, as well as bond and equity pieces.
Considering where Allied Waste's securities are trading and the company's access to the capital markets, lenders believe that the company will be able to successfully complete a new deal. In addition, "The management team is very well regarded. The ceo [Thomas Van Weelden] walks on water with a lot of people," said one dealer. A buysider concurred with this sentiment, noting that any time the company set goals for itself, it follows through.
In contrast, another dealer proclaimed his bearish opinion on Allied Waste, saying that the company will never be able to de-lever. Furthermore, market players brought up lingering concerns over possible accounting issues at the company. Allied Waste's name always seems to pop up in rumblings over accounting issues, one dealer said, but there has never been any evidence to indicate that the company has any accounting problems. J.P. Morgan, Credit Suisse First Boston, and Citibank hold the major roles on the company's current bank deal. Calls to Thomas Martin, Allied Waste, v.p. and treasurer, were referred to a spokesman who did not return calls by press time.