VoiceStream's "A" and "B" tranches both traded up over par last week, with some dealers attributing the notch up to the merger to Deutsche Telekom. One trader explained that investors believe Deutsche Telekom will call the paper at par in the near future, which will buoy levels. The investor relations department did not return calls.
"No one will pay much above par since it could get called any day and the investor would lose money. No one would really sell at much of a discount since, again, it could be paid be off at par any day and the investor would be leaving money on the table," said the trader. "As a result it stays very defensive--stays around par--and most investors like this in a volatile environment."
VoiceStream last traded at 99 3/4 in a $10 million trade late last month (LMW, 5/24).