Keystone Automotive loan breaks for trading, edges higher; Charter slips, Collins & Aikman rises

By Carlise Newman

Chicago, Oct. 28 - Trading was relatively thin in the bank debt market as many traders headed to a conference held by the Loan Syndications and Trading Association, but some excitement was to be had as Keystone Automotive Operations Inc.'s credit facility broke for trading Tuesday.

Keystone's $165 million credit facility broke mid-day and moved slightly higher.

The facility was trading "just north of par," a trader said.

The facility consists of a $115 million term loan B and a $50 million revolver at Libor both at Libor plus 300 basis points.

Originally, the revolver was talked at Libor plus 300 basis points and the term loan B was talked at Libor plus 350 basis points.

Proceeds will be used to help finance Bain Capital's acquisition of Keystone from the company's current equity partners, which includes Advent International, GE Commercial Finance and Littlejohn & Co. The transaction is expected to close in the fourth quarter of this year.

The Exeter, Pa.-based company markets and distributes automotive parts and accessories in the specialty automotive aftermarket.

Bank of America and UBS are joint lead arrangers and joint lead managers on the deal.

Elsewhere, Charter Communications Inc.'s term loan B was in the "low 97" bid area, according to a trader, while he quoted the revolver at 95 1/8 bid. The term loan B was last seen trading slightly higher at 971/4, and the revolver had been seen around 95½ bid at last trade a few weeks ago.

Also in the secondary, Collins & Aikman Corp.'s term loan A was quoted at 99 bid, the term loan B at par bid and the revolver at 96 bid, according to a trader.

"Collins & Aikman has been doing pretty well of late. The term loan A seems headed to pass par," he said.

The company's debt has moved up several points in recent weeks after being hit hard by a report early this month in The Detroit Free Press that DaimlerChrysler AG's Chrysler Group is looking to rebid nearly all of the current and future business it does with the company.

In other news, Western Wireless Corp.'s bank debt continued to move higher, adding another 1/8 of a point on Tuesday. The term loan B was trading just over par, the term loan A at 97 5/8 and the revolver B at 97 3/8, a trader said. The debt has risen over a point in the last few days.

Last week the company released positive third quarter earnings numbers that included consolidated adjusted EBITDA of $129.4 million, an increase of 53% over the third quarter of 2002, consolidated total revenue of $401 million for the third quarter, a 31% increase over the third quarter of 2002, consolidated net loss for the quarter of $18.5 million or $0.23 per basic and diluted share, an increase in domestic subscriber revenue by 20% over the third quarter of 2002 to $187.1 million, an increase in domestic roamer revenue of 12% over the second quarter of 2003 to $61.1 million and an increase in domestic free cash flow for the nine months ending Sept. 30 of 30% compared to the same period last year.

Also during the quarter, the Bellevue, Wash. wireless communications provider prepaid $400 million of its senior credit facility and redeemed all its 10½% senior subordinated notes due 2006 and 2007 with proceeds from a $600 million senior notes offering, the sale of the company's interest in its Croatian wireless business and the offering of $115 million in convertible subordinated notes.

Also moving Tuesday was Allegheny Energy Inc. bank debt. The second-lien debt was seen at 97 bid, 97¾ offered, a trader said, ½ point lower than last Friday when it was last seen trading.

The troubled U.S. power company said Tuesday its 2003 quarterly financial statements may be filed later than it anticipated, according to news reports. Allegheny filed its 2002 annual report last month after a long delay prompted by an internal audit.

The company is struggling to refocus on its primary utility business and pay down debt accrued during the heyday of investments in non-regulated energy markets.

The company, which has nearly $600 million in debt due next year and more than $2 billion due in 2005, hopes to complete a refinancing of a portion of those maturities in the first quarter of next year. It is also considering an equity offering in late 2004 or early 2005, according to reports.

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