McLeodUSA's bank debt was pushed down to 69 from the low 70s last week in a series of small trades following the company's filing for Chapter 11 protection in December. Last week, the company also announced that the company would offer its publicly traded bonds in exchange for at least $560 million in cash, plus about 15% of its common stock.
In December the company announced it would pay down $140 million of its revolver, which pushed the debt up to the 74 range (LMW, 12/8). While the development was positive to traders as it would reduce leverage, they said trading was stalled by bidders hoping to see the price come down further. McLeod has a $1.3 billion deal that breaks down into three tranches and expires in 2008. J.P. Morgan, Bank of America, Citibank and Goldman Sachs are the lead arrangers, according to Capital DATA Loanware.