Mirant bonds still moving higher; HealthSouth firmer; WorldCom actively traded

By Carlise Newman

Chicago, Aug. 29 - Mirant Corp. was still going strong Friday after releasing first-quarter results Thursday afternoon, in an otherwise lackluster pre-holiday shortened trading session.

The bankrupt energy producer reported a wider first-quarter net loss on higher fuel costs and restated its results from the year-earlier period due to accounting errors.

Mirant Americas Generating bonds were up two points on the day to 75 bid, 78 offered, a trader said. Mirant's bank debt was seen up ½ point to 44 bid, 45 offered.

"The bonds charged up right after the report came out. Today they were still moving but there weren't that many people to trade them," a trader said.

The Atlanta company reported a loss of $28 million (7 cents per share), for the quarter ended in March, compared with a restated year-earlier loss of $10 million (6 cents per share). The company originally reported a first-quarter net loss of 10 cents a share in 2002.

For this year's first quarter, income from continuing operations was 4 cents per share.

HealthSouth Corp. were still "somewhat active" after the company on Thursday said it can pay the interest on its debt.

HealthSouth said its lending banks have waived an earlier payment blockage, allowing the company to pay past-due interest on its subordinated debt.

HealthSouth's 7 5/8% notes due 2012, which rose 4 points Thursday, shot up another 2 points Friday to 87 bid, 89½ offered, one trader noted. The 10¾% notes due 2008 rose to 86 bid from 84 bid.

"They had a good run this week. We'll probably see them unchanged to lower next week," he said.

WorldCom Inc. bonds were still actively traded "in medium-sized lots" on Friday.

WorldCom's bonds were quoted Thursday at 30 bid, 31 offered, ¾ of a point higher than Thursday, and seemingly oblivious to the negative news pelted at the company this week.

On Wednesday, Oklahoma attorney general Drew Edmondson charged WorldCom, its former chief executive Bernie Ebbers and five others with violating state securities laws by knowingly giving false information to investors. The charges were revealed on Wednesday.

The 15-count complaint in Oklahoma contends that the company and the former executives used deceptive measures to defraud investors, lied about the company's financial health and ran a business that operated as a fraud.

On Tuesday, news was out that WorldCom is likely to keep to its schedule to emerge from bankruptcy protection.

"We did a lot of WorldCom today and not a whole lot else," a trader said.

Elsewhere, Twinlab Corp.'s 10¼% notes stabilized at 46 bid, 48 offered, unchanged from Thursday when they rose 4 points, a trader said.

Twinlab said Wednesday it will implement a sale of its business through a Chapter 11 bankruptcy filing. The Hauppage, N.Y.-based health supplement company said it is unlikely that any purchase price for the sale of the business will exceed the amount of the company's debt and as a result, equity holders may receive no value.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.