The Warnaco Group's bank debt has been generating more interest as the company winds down its bankruptcy proceedings. Dealers said a plethora of paper has been trading in the 33-35 context over the last couple of weeks as investors looking for an equity play buy into the paper. Banks and other firms not wanting to hold the equity are selling the name. By last Thursday, the paper was offered as high as 36 1/4 in the street.
Under the new plan, the secured lenders will receive approximately $104 million in cash, as well as a $200 million new issue of second lien notes, and 96.26% of the common stock in the reorganized company. Warnaco is looking to emerge from bankruptcy on Feb. 4. Jim Fogarty, Warnaco cfo, could not be reached by press time.