Adelphia Communications' Century Cable bank debt took a hit last Wednesday falling from the 99 range to 98 1/4 98 3/4 after its earnings release disclosed more than $2 billion in debt under the company's "managed entities." Dealers moved roughly $20 million of the paper.
Traders said that investors were unnerved by the disclosure of this off-balance sheet debt and were trying to determine whether or not there would be recourse to the parent company. Most market players, however, believe that the company's fundamentals are still solid and that the latest buzz will quiet down. "Personally it just sounds like noise," said one trader of the uncertainties following the release. "If it turns out that there is nothing to worry about, I have buyers," said another.
Adelphia Business Solutions, spun off by Adelphia Communications in January, filed for bankruptcy on the same day but dealers said its status did not affect its parent company. Calls to company officials including Timothy Rigas, company cfo and treasurer, and Jim Brown, v.p., finance, were not returned.