Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Loan Market Commentary 01/27/2010

The loan market was very, very quiet today and most people spend their morning watching Timmy Geithner get peppered on CNBC. Everything was pretty much flat, the only stuff that really did anything were company’s who announced earnings or were in the news and distressed names because dealers were cleaning up their axe sheets ahead of month-end. Despite being a dead day in the secondary market, it was a pretty heavy news day. United Airlines announced better than expected 4Q earnings, price talk for Cedar Fair’s new TL came out, Isle of Capri sealed the deal on their amendment, Carmike Cinema’s term loan broke for trading and the Warner Chilcott drama continued. The LCDX 13 was out the door today down a quarter to 101 5/8 – 101 7/8, and remained there for the entire day. Tomorrow will be interesting and the direction of the market is at the mercy of the tone that comes across tonight in President Barack Obama’s first State of the Union address. Many doubt that the Wall Street bashing will stop, so it is unlikely that we will see a shift in sentiment. Being that the market has been dead the past two days, I would not be surprised to see a ton of volume in the morning with bids pulling back another quarter.
  • United Airlines' term loan firmed today after parent company UAL Corp posted a smaller-than-expected quarterly loss. The loan was quoted today at 80.5-81.5. UAL said its fourth-quarter net loss narrowed to $240 million, or $1.44 per share, from $1.32 billion, or $10 per share, a year earlier. Excluding hedge gains and accounting charges, UAL said its quarterly loss was $176 million, or $1.05 a share. On that basis, analysts expected a loss of $1.47 a share, according to Thomson Reuters. Operating revenue fell 8% to $4.19 billion, compared with $4.09 billion expected by analysts.
  • Cedar Fair LP is offering an OID of 99.5 on its $1.25 billion deal, sources said. The deal is oversubscribed and allocations have yet to be finalized, according to sources. The new deal is priced at LIB+375 with a 1.5% Libor floor. The amend and extend would have paid LIB+400 with no Libor floor. The two tranches are part of the $1.95 billion financing backing the acquisition of the regional amusement park operator. There is a separate $700 million bridge loan.
  • Isle of Capri Casinos has sealed the amendment on its $1.35 billion deal after giving in to not removing the monthly report requirement, sources said. The company had wanted to remove the requirement but lenders disagreed. The company also asked to add a $100 million investment bucket, allow the issuance of unsecured notes, and amend the definition of EBITDA. Pricing is increased to LIB+300 with a 2% Libor floor, compared to the existing LIB+175. The $475 million revolving credit facility in the deal will also be reduced by at least $100 million. The undrawn fee is increased to 75bp from the existing range of 25-50bp.
  • Del Monte's $600 million term loan is bid at par, sources said. Pricing opens at LIB+300 with a 50bp commitment fee and will conform to a debt ratio grid six months after closing. Earlier, allocations were released and reported. Over 50 lenders piled onto the $1.1 billion two-tranche deal which also includes a $500 million revolving credit facility. The three leads are Bank of America Merrill Lynch, Barclays Capital.
  • Carmike Cinemas Inc's new $275 million, six-year term loan broke for trading this morning and is currently quoted 100.5-101, sources said. The loan was sold at 99. The proceeds are to refinance its existing term loan. JP Morgan is lead and is joined by Citi and Macquarie Capital as joint bookrunners.
  • Today's launch of the $385 million loan for competitive local exchange carrier US TelePacific has been postponed, sources said. No reason has been provided to potential lenders. A new launch date is expected to be scheduled shortly, sources added. The loan is led by Credit Suisse, Deutsche Bank and Bank of America Merrill Lynch.
  • Warner Chilcott's loan is trading 100.375-100.625 this morning, down from a high of 100.625-100.875 late yesterday, after the company backed off from its repricing proposal, sources said.