Wyndham International's bank debt got a slight boost last week in anticipation of amendments that were finalized Thursday. The "B" paper traded up to the 87 range, while the increasing-rate loan traded in the 85 range. This is up from prior levels of the low 80s. Volume was estimated around $15 million. Calls to the company were referred to Andrew Jordan, spokesman, who confirmed that the company had a meeting with the bank syndicate on Thursday. He declined to comment further.
Dealers were skeptical, however, that the credit would go much higher on the amendment. By late last summer, Wyndham had traded steadily into the high 99 range on anticipation of an acquisition by London-based Bass Hotels. But following Sept. 11, the hotel industry was severely impacted and speculation of a merger ceased. "The debt was higher before the company went into bankruptcy," a dealer said. Wyndham's uptick in levels was tempered last week by the doubling of defaults in hotel credits, dealers noted. However, dealers say Wyndham has held up partly because the amendment was perceived as a proactive measure taken by the company in light of a troubled economy.
In early December, dealers were predicting the company would get an amendment which would secure the bank debt with hotel mortgages (LMW, 12/8). This would allow holders to take possession of the company's properties if it should default. Wyndham has a $1.3 billion deal that breaks down into three tranches. Pricing is LIBOR plus 33/ 4%. J.P. Morgan leads the deal.