Lyondell Chemical announced on Tuesday that it would use $200 million of the proceeds from an offering of $275 million, 10-year senior secured notes and a public offering of 7,000,000 shares of common stock to pay down existing indebtedness under the company's term loans. Traders said the name was not changing hands, but quoted the term loan "E" at 101 3/4 to 102 1/2 up from the 100 1/2 101 level two weeks ago. The term loan "E" has a call protection of 102. Doug Pike, company spokesman, could not be reached for comment.
A $80 million of Comdisco was believed to trade out of Morgan Stanley last Friday at the 83 level. Traders said that the name was moving after the company released its second reorganization plan, which said the unsecured debt holders were to be paid back at 90 cents on the dollar after the company works through Chapter 11. One trader said the new plan was an improvement from the company's first plan, which only offered creditors a return in the low 80s. Calls to David Reynolds, company controller, were not returned.
Market players said that levels for Kmart's bank debt fluctuated briefly this week, falling a couple of points on the fear that Martha Stewart would be implicated in insider trading on ImClone Systems. One dealer said that more than $20 million changed hands by Tuesday, with the 364-day facility moving in the 73-74 range and the three-year facility moving in the 67-68 range. By Wednesday the name was said to be quiet. Calls to Jack Ferry, the company's spokesman, were not returned.