Dura loans widen out; Delphi, Hayes Lemmerz bonds gain

By Paul Deckelman and Sara Rosenberg

New York, Sept. 11 - Dura Automotive Systems Inc.'s second-lien term loan levels widened out during Monday's market hours basically due to lack of activity in the name and in the overall distressed loan market, according to a trader.

In the junk bond market, bonds of Hayes Lemmerz International Inc. shot upward after the Northville, Mich.-based maker of automotive wheels reported better-than-expected quarterly numbers.

Bonds of bankrupt Troy, Mich.-based parts maker Delphi Corp. were also seen stronger, though on no news.

Outside of the automotive area, airline bonds continued to gain altitude, just as they have over the previous several sessions, on lower world oil prices, which are seen by some as a predictor of possibly lower jet fuel prices further down the line.

Dura loan, bonds lower

Dura's second-lien paper closed out the day quoted at 97.5 bid, 98.5 offered, off from Friday's closing levels of 98.25 bid, 98.75 offered, the trader said.

"It was very quiet today. I think a lot of people were out of the office for 9/11 memorials," the trader remarked.

Recently, Dura's second-lien loan has bounced around on investor uncertainty over the perfection of the lien.

Last Thursday, the loan had fallen by about a point and a half to the 98 context due to nervousness over this lien issue and then rebounded slightly on Friday as the apprehension eased.

A trader in distressed notes meantime saw the Rochester Hills, Mich.-based automotive systems maker's 8 5/8% senior notes due 2012 down a point at 71 bid, 73 offered, and saw its 9% subordinated notes due 2009 unchanged at 15 bid, 16 offered.

Another trader saw the subs down a point at 14.5 bid, 15.5 offered, and pegged its 8 5/8s at 71.75 bid, 72.75 offered, down ¾ point on the session.

Delphi better on no news

On the upside, traders said, were Delphi's bonds, although nobody saw any particular news about the former General Motors Corp. unit, which is in the midst of trying to lower its bloated labor costs.

The partsmaker's 6½% notes due 2009 up 2 points at 93 bid, 94 offered, and its 7 1/8% notes due 2029 up 2 points at 86 bid, 87 offered.

Hayes higher on numbers

Another name from that same sector seen heading up on Monday was Hayes Lemmerz.

Its 10½% notes due 2010 were seen by a trader up 4 points to 80.5 bid, 81.5 offered, while another trader saw the bonds up 5 points to 82 bid, 83 offered on better-than-expected second-quarter numbers.

The company said it lost $26.9 million (70 cents per share) - well down from its year-earlier loss of $70.3 million, or $1.85 per share. Revenue grew 5% to $583.4 million from $556 million in the year-ago period. The company credited the gains to overseas expansion, and also noted gains it notched from the recent restructuring of its North American securitization program.

Elsewhere in the sector, GM's 8 3/8% notes due 2033 were seen unchanged at 87 bid, 87.5 offered, while its General Motors Acceptance Corp. financing arm's 8% notes due 2031 were up ¼ point.

Ford Motor Co.'s 7.45% notes due 2031 were unchanged at 80 bid, 80.5 offered, while its Ford Motor Credit Co. 7% notes due 2013 were a point lower at 93.5 bid, 94.5 offered.

Northwest, Delta up as oil drops

Among the airlines, a trader said, Northwest Airlines Corp.'s bonds were up a point on the session, with its 8 7/8% notes due later this year at 51 bid, 52 offered, and its other issues, such as the bankrupt Eagan, Minn.-based Number-Four U.S. carrier's 7 7/8% notes due 2008 a point behind that at 50 bid, 51 offered.

Bankrupt Atlanta-based Number-Three carrier Delta Air Lines Inc.'s 8.30% notes due 2029 were seen ½ point better at 26.5 bid, 27.5 offered, while its 7.90% notes due 2009 were a point behind at 25.5 bid, 26.5 offered, also up 1/2.

The bonds of the airlines have been firming in recent days, coinciding with a six-session slide in world crude oil prices, which in some quarters are viewed as an indicator of possible future directions of jet fuel prices.

In Monday's dealings, light sweet crude fell 64 cents to $65.61 per barrel on the New York Mercantile Exchange.

Rotech, Solo better

Elsewhere, Rotech Healthcare Inc.'s 9½% notes due 2012 were seen up 2 points at 72 bid, 74 offered, although no fresh news was seen out on the Orlando, Fla.-based provider of healthcare products and services.

Its Nasdaq-traded shares were up 25 cents (17.24%) at $1.70, although volume of 350,000 shares was slightly less than normal.

A trader saw Solo Cup Co.'s 8½% notes due 2014 two points lower at 86 bid, 88 offered.

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