Deutsche Bank was rumored to have completed a $15 million trade of GenTek in the mid-50s last week after the company filed for Chapter 11 bankruptcy protection on Oct. 11. The company has stated that it will not seek a debtor-in-possession facility because, with $110 million in cash on hand and cash flow from continuing operations, it has enough money to fund operations and obligations to customers, vendors and employees. The market for the bank debt was quoted in the high 50s before the filing. Officials at Deutsche Bank declined to comment.
GenTek has been hurt by the lack of demand for its telecommunications products, and its bank debt has been slipping since the company fell into noncompliance with its bank covenants earlier this year. The situation was compounded after lenders decided to block GenTek from making an Aug. 1 interest payment on its subordinated notes (LMW, 8/5). Calls to Matthew Friel, cfo, were referred to a spokesman, who could not provide additional information at this time.