Dade Behring bank debt has taken a 10-point jump in two weeks, hitting 80 last week, over anticipation that a restructuring deal is in the works. A market watcher theorized that the prospect of a partial debt for equity swap is propelling the debt, while another said there may be a move made to buy the company. The diagnostic blood equipment manufacturer held a conference call to lenders late Thursday. The company has a $1.250 billion deal that breaks down into five tranches and expires in 2007. Deutsche Banc Alex. Brown, Morgan Stanley, Goldman Sachs, and Credit Suisse First Boston are the lead arrangers. Officials at the banks did not return calls regarding the conference call by press time.
A company spokeswoman in Deerfield, Ill., confirmed a possible restructuring. "We are in positive and constructive negotiations regarding a restructuring," she said, declining to elaborate further or comment on any movement in the bank debt. "If they restructure, banks are getting equity. Whoever's a holder will have equity, and the equity will be worth more," a market player explained. Dealers said the credit was hit by the healthcare industry crunch, but it has weathered that and now the industry is seen as stronger, Dade Behring's levels are moving up.