Collins & Aikman rebounds; Conseco rockets higher; WorldCom trades actively, again

By Carlise Newman

Chicago, Sept. 5 - There was a lot of action Collins & Aikman Products Inc.'s debt Friday, along with buyers in AK Steel Inc. and - especially - Conseco Inc. in a session somewhat active for a Friday.

Collins & Aikman firmed during the session after falling 4 points on Thursday. Its 10¾% senior notes ended the day at 88 bid, up from 84 bid Thursday. The 11½% subordinated notes due 2006 ended the session at 74 bid from 79 bid Thursday.

"They're back to the levels they were trading at before yesterday," a trader said.

Traders said the slide occurred Thursday due to news that Troy, Mich.-based Collins & Aikman lost a contract to supply components to DaimlerChrysler for its Jeep line, which is 2% of the company's revenue.

Meanwhile, traders said Conseco Inc. was back in the picture Friday.

"Conseco was really rolling today," a trader said.

Conseco was about 10 points higher across the board, with all of the buying happening in the afternoon, a trader said.

"It looks like they might be coming out of bankruptcy sooner than expected," he said.

Conseco's extended bonds were quoted at 82 bid, while its unextended bonds were seen at "47 and looking [for offerings]," a trader said.

"The big hands were in Conseco and WorldCom today," added another.

Conseco Inc. filed its fifth amended plan of reorganization with the bankruptcy court in mid-August. The plan has virtually no change from the fourth plan, but a settlement with the holders of its Trust Originated Preferred Securities clears the way for court approval.

The court has set Sept. 9 as the confirmation hearing date.

Elsewhere, steel and asbestos names were still moving Friday.

"AK Steel paper was traded in big lots," a trader said.

AK Steel Inc.'s 7¾% notes due 2012 were seen at 77 bid, 79 offered, down from 81 bid, 83 offered Thursday.

Armstrong World Industries Inc.'s bonds were unchanged at 52 bid, 54 offered, a trader said.

On Monday, the Lancaster, Pa.-based flooring manufacturer said it obtained court approval to extend the voting deadline on its reorganization plan until Oct. 17 at 5 p.m. ET. The voting deadline was previously Sept. 22.

A confirmation hearing is scheduled for Nov. 17.

Meanwhile, Owens Corning's 7½% notes due 2005 were seen at 42 bid, 44 offered, a fall of 1 point, a trader said.

Twinlab Corp.'s bonds continued their ascent Friday, rising to 64 bid, 67 offered, up 3 points from Thursday's levels.

The Hauppage, N.Y.-based health supplement company filed for Chapter 11 bankruptcy protection

Thursday, and said it will sell its assets to Ideasphere Inc. for $65 million in cash, the assumption of $3.7 million of liabilities of the company, and the assumption of the company's executory contracts and unexpired leases.

"If it makes it through court approval, I don't know much about the company, but it can't be a bad thing for Twinlab," a trader said.

WorldCom Inc. was still "pretty hot" Friday, a trader said. WorldCom's benchmark bonds closed at 29½ bid, 30 offered, a drop of 1/8 of a point, a trader said.

"The prices aren't moving much but the bonds are very active. Not a day goes by that we don't see a lot of them trading," he said.

On Wednesday WorldCom's chief executive Bernie Ebbers pleaded not guilty in an Oklahoma court to 15 criminal charges, including securities fraud, that could bring him up to 10 years in jail. Ebbers was freed on $50,000 bond and the next hearing in his case is scheduled for October.

In other news, Goodyear Tire and Rubber Co. bonds were "busy" a trader said, still cheered by the news Thursday that employees at a Wisconsin factory ratified a three-year contract with the company, becoming the first of the 14 local unions to do so.

The 7 7/8% notes due 2011 were seen at 81 bid, 82 offered Friday, a rise of 1 point.

Elsewhere, Oakwood Homes Inc. bonds were seen at 28 bid, 32 offered, firming up from 25 bid, 28 offered earlier in the week. The bankrupt Greensboro, N.C.-based home manufacturer obtained an extension to file its reorganization plan to Oct. 31 from Aug. 13.

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