Tesoro Petroleum's bank debt has fallen from the low 90s to 84-85 1/2, with a few small trades taking place in that range. The company is currently in negotiations with its lending group to amend its bank covenants. One trader suggested that the bank group was looking to take out all its existing covenants and replace them with minimum EBITDA and maximum capital expenditure clauses. Market players predicted that levels would continue to slide. "I think that it's going to march its way to the down into the 70s. There's just too much debt there," one trader said. Calls to Gregory Wright, cfo, were not returned.
The market for Exide's bank debt has slipped roughly 10 points into the low 50s-high 40s as the battery maker continues to work its way through bankruptcy. The bank debt also received a low rating in the Shared National Credit exam and bank holders will have to write-down the credit, noted one trader. The paper has not changed hands this week, but one dealer said that market players were waiting for the outcome of a bank meeting on Thursday. Calls to Lisa Donahue, the company's cfo and chief restructuring officer, were referred to a spokesman who declined comment.
Allied Waste Industries' term loan "B" was trading a point higher after the company announced that it would issue $250 million in senior notes and use the proceeds from the offering to pay down its term debt pro rata. A few small pieces are believed to have traded in the 98 1/2 to 99 range this week. Thomas Ryan, cfo, could not be reached by press time.