Merisant down with filing; Cablevision inches up; Tropicana regains some ground

By Sara Rosenberg

New York, Jan. 9 - Merisant Worldwide Inc.'s term loan traded lower as the company, not so unexpectedly, filed for bankruptcy protection on Friday, and Cablevision Systems Corp. was better on the heels of the company's successful bond offering.

Also in trading, Tropicana Entertainment LLC's opco term loan recouped some of its losses from the previous session, although activity in the name was relatively light.

The tone in the cash market in general was hard to read because of low volume, but sources found that loans neither were down very much nor were they up very much.

Merisant slides with Chapter 11

Merisant's term loan weakened during Friday's trading session on news that the company filed for Chapter 11, according to a trader.

The term loan traded at 55 on Friday, compared to previous levels of 60 bid, 65 offered, the trader said.

The trader went on to say that the trade took place prior to the bankruptcy filing taking place on Friday afternoon, but it was probably done by someone who caught wind of the situation. As of the late afternoon, which was post-filing, the trader had not seen any updated levels on the debt.

As of Nov. 30, the company had $331.08 million in assets and $560.72 million in debt.

Merisant filing predicted by Moody's

Merisant's decision to go into bankruptcy was largely expected by the market, the trader remarked, and had already been written up as a possibility by Moody's Investors Service a few days earlier.

On Jan. 6, Moody's downgraded Merisant's ratings, including cutting its bank debt to Caa1 from B3.

Moody's had said that the downgrade was based on concern that given the current bank credit markets and the company's weak credit metrics, Merisant may not be able to refinance its revolver and term loan A, which mature on Jan. 11.

The rating agency also said that the upcoming bank debt maturities increased the likelihood of a distressed exchange or bankruptcy filing.

Merisant is a Chicago-based producer and marketer of low-calorie and zero calorie tabletop sweeteners.

Cablevision better bid

Cablevision's term loan B saw a higher bid on Friday on the back of the company completing a quick-to-market bond offering, according to a trader.

The term loan B was quoted by the trader at 87½ bid, 89½ offered, compared to 87 bid, 90 offered on Thursday. A different trader had the paper quoted at 87 bid, 88 offered on Thursday.

"Might be in sympathy with the new bonds trading up or might be because people feel good that they were able to access the capital markets," the trader remarked in explanation of the bank debt's performance on Friday.

On Thursday, CSC Holdings Inc., a subsidiary of Cablevision, sold $844 million of 8½% five-year senior notes for about $750 million in proceeds. The notes priced at 88.885 to yield 11 3/8%. This offering had been upsized from an original size of $500 million.

Proceeds from the notes will be used to address the company's upcoming debt maturities.

Cablevision is a Bethpage, N.Y.-based media and entertainment company.

Tropicana gains ground

Tropicana Entertainment's opco term loan rebounded a bit from the losses it amassed during the previous trading session, but the improvement was on pretty low volume, according to a trader.

The term loan was quoted at 23½ bid, 24½ offered, up from Thursday's levels of 22½ bid, 23½ offered, the trader said. On Wednesday, the loan was quoted at 26 bid, 26½ offered.

"There was a seller yesterday and it was a heavy day, and I think people were nervous about the [plan of reorganization]. Didn't learn a whole lot from it, so think people are getting back in it and moving it back to where it was," the trader explained.

Earlier in the week, the company announced its plan of reorganization, but there was no disclosure statement released.

Under the plan, the company will do a $100 million common stock rights offering for holders of unsecured noteholder claims, issue $100 million of new notes and issue four-year warrants equal to 15% of the value of the common stock outstanding on the confirmation date.

Tropicana is a Fort Mitchell, Ky.-based gaming entertainment provider.

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