GenTek's bank debt ticked down to the 82 1/2 - 83 range following its first quarter earning results that reported weak revenue and default on its current credit agreement. The name has been moving in the 83-85 range over the last month. One trader estimated that more than $30 million of the name has traded over the past two weeks. The company is in default on its senior credit agreement because of non-compliance with certain covenants under that agreement. GenTek's lending group has the right to require accelerated repayments of the loans, but the company is currently working with its bank group to amend the credit agreement.
As a global manufacturing company, GenTek has been hurt by the lack of demand for its telecommunications products. The company has already fully drawn down the availability under its revolver.