Allied Waste breaks and trades actively at par ½ bid, par 5/8 offer on the B loan

By Sara Rosenberg

New York, April 25 - Allied Waste Industries Inc.'s $1.5 billion seven-year term loan B broke for trading in the secondary bank loan market on Friday and traded actively throughout the day, according to traders. The institutional tranche, which was issued at par, broke with a par ½ bid, par 5/8 offer.

"It was very active today, with the low point at [par] ½ and the high point at [par] 3/4" one trader told Prospect News. "I think there were some guys playing games in the market trying to make it look weaker than it was but at the end of the day it seems pretty solidly bid at par 1/2."

The term loan B carries an interest rate of Libor plus 325 basis points and is part of a $3 billion facility (Ba3/BB/BB) that also includes a $1.5 billion five-year revolver with an interest rate of Libor plus 300 basis points.

JPMorgan, Citibank, Credit Suisse First Boston, Deutsche and UBS Warburg are the lead banks on the Scottsdale, Ariz. solid waste management company's refinancing deal.

Cumulus Media Inc.'s $325 million term loan C (B+) with an interest rate of Libor plus 250 basis points also broke for trading on Friday, according to traders, who heard the loan quoted at par ¼ bid, par ½ offer. The tranche, like Allied Waste, was also issued at par.

Proceeds from the Atlanta radio broadcasting company's term loan C will be used to pay for tendered notes and delivered consents, repay the existing $175 million term loan B and for other general corporate purposes.

Charter Communications Inc.'s term loan B was quoted around 90 bid, 91 offer, according to one trader, who stated that the paper was "sideways" from the previous day's levels. A second trader, however, found the St. Louis cable company's paper to be "better bid" from Thursday's level and quoted the bid at 903/4.

Nextel Communications Inc.'s term loan B and C started the day trading at 981/2, according to a trader, and then by late afternoon the paper backed down to 981/4.

When asked what caused this mini-drop, a second trader responded that there was no particular reason behind it and, since it was only lower by a quarter of a point, market participants were unconcerned with the paper's performance.

The Reston, Va. wireless company's bank debt has been a solid performer this week especially after the release of favorable earnings news that showed a first-quarter net income of $208 million, or 20 cents a share, compared with a year-ago loss of $654 million, or 84 cents a share; revenue increased to $2.37 billion from $2 billion; and, the company retired about $568 million in debt and preferred stock during the quarter.

On Thursday, Nextel's term loan A traded at 95 and its term loan B and term loan C were quoted with a 98¼ bid, 98½ offered. On Wednesday, the B and C term loans were quoted at 97¾ bid, 98 offered.

Meanwhile, allocations for Amphenol Corp.'s credit facility are anticipated to occur late next week, a syndicate source told Prospect News on Friday, adding that the pro rata portion of the facility is expected to wrap up in the next couple of days and the term loan B has been oversubscribed for a while. The loan is expected to officially close sometime in early May.

The loan (Ba2/BB+) consists of a $125 million five-year revolver with an interest rate of Libor plus 200 basis points, a $125 million five-year term loan A with an interest rate of Libor plus 200 basis points and a $500 million seven-year term loan B with an interest rate of Libor plus 250 basis points.

Deutsche Bank and UBS Warburg are the lead banks on the deal that will be used to refinance the existing credit facility and to repay $144 million of 9 7/8% senior subordinated notes.

Amphenol is a Wallingford, Conn. producer of electronic and fiber optic connectors, cable and interconnect systems.

Oxford Health Plans closed on a $450 million credit facility, consisting of a $400 million six-year term loan with an interest rate of Libor plus 250 to 275 basis points and a $50 million five-year revolver with an interest rate of Libor plus 225 basis points and a commitment fee of 50 basis points.

Term loan proceeds will be used to fund the company's $208 million obligation on the previously announced $225 million settlement of the 1997 securities class action litigation, to refinance approximately $120 million of existing debt and for general corporate purposes.

The revolver replaces the company's existing $50 million revolver.

Credit Suisse First Boston and Bank of America were the lead banks on the Trumbull, Conn. healthcare company's deal.

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