Traders last week were buzzing about an auction of $75 million of Mirant bank debt that was originally scheduled for Wednesday, but by the end of the day most doubted it ever took place. Dealers said they heard an unnamed seller was looking to offload the paper early in the day, but by afternoon noise surrounding the auction had stopped. Several traders noted that the paper did not change hands, and some even said that the auction was not real. "My view is that it was totally false," noted one trader.
The paper had been scheduled to go off in the 25-40 context, according to one market player. Later in the week, however, the market was quoted in the 45-50 range, a trader said. The company recently released its second quarter results and disclosed $41 million of accounting errors and a second quarter loss of $220 million. A Mirant statement did, however, claim the company had access to $1.5 billion of liquidity. Calls to Raymond Hill, cfo, were not returned.