A number of asbestos credits were bid up last week on news that the litigation cases would be consolidated under one judge, rather than handled separately. Dealers reported W.R. Grace debt traded up to the high 40s from the mid-40s, while Armstrong World Industries' debt was bid up to the 53 range, up from 50 a week ago. "The market views this as a positive, since it speeds the process up," said a dealer. W.R. Grace is a Columbia, Md.-based chemical producer. Robert Tarola, cfo of W.R. Grace, declined to comment. Spokesman Greg Euston said, "While we don't know which way the decision will go, the company believes having a single judge means consistency in the decision-making process. It's good for all the companies involved." Calls to Armstrong officials were referred to spokeswoman Jean Gallagher, who did not return them by press time.
W.R. Grace has a $422 million credit facility, which expires in 2003. The credit traded at 45 last spring after the company filed for bankruptcy (LMW, 4/8). Added to the blow was the fact that lenders would not be in a secured position. On Sept. 25, Armstrong was granted a six-month extension on submitting its reorganization plan. The company has a $300 million deal that expires this year. J.P. Morgan is the lead arranger.