Nova recoups losses; Freescale slides on revolver draw; Univision loan gains strength; Charter mixed

By Stephanie N. Rotondo and Sara Rosenberg

Portland, Ore., Jan. 22 - After losing as much as 20 points during Wednesday's session, Nova Chemicals Corp.'s debt fought back, regaining most of those losses on Thursday.

The company's bonds took a dive following reports that liquidity was not sufficient to cover upcoming maturities. However, late in the day Wednesday, Nova responded to those claims, essentially calling them false. As a result, the bonds went back up on Thursday.

Meanwhile, Freescale Semiconductor Inc.'s debt structure ended weaker. The decline came on the back of news that the company had drawn down its revolving credit facility.

Spanish language television producer Univision Communications Inc.'s term loan gained some ground, traders reported. The increase in the bank paper was attributed to news that the company had settled a lawsuit.

In other television-related news, bankruptcy chatter has gotten louder over at Charter Communications Inc. The cable provider is currently in a 30-day grace period after missing a coupon payment earlier this month and reports earlier in the week indicated a bankruptcy was near. Charter's debt has thus gone both directions in response to the fears.

Nova notes recoup losses

Nova Chemicals' debt fought back Thursday after losing about 20 points during Wednesday's session.

One trader said the 7.4% notes coming due in April "rebounded a good bit," moving back up to 80 bid, 81 offered from the mid- to high-60s previously.

"What they gave away yesterday they flattened out," another trader said. He also saw the 7.4% notes around 80, noting that about $30 million traded. The floating-rate notes due 2013 were also better, gaining more than 3 points to close around 30.25, while the 6½% notes due 2012 moved up to 39 from 33 bid, 35 offered.

Another source deemed the 6½% notes more than 2 points stronger at 37.25 bid.

The plastics and chemicals producer's bonds took a dive on Wednesday, following a news report that called the company's liquidity position into question. That concerned some market players as to whether Nova would be able to pay the $250 million upcoming maturity.

But late in the day, after the market had already closed - and the company's stock had taken a beating - Nova issued a response. In the statement, the company claimed it had sufficient liquidity and was not considering repurchasing any bonds. Nova went on to say that it would not add anything further until its quarterly results come out next week.

Following the massive slide in the bonds, Standard & Poor's said Thursday it placed Nova's credit rating under review.

Freescale debt mostly lower

Freescale Semiconductor's term loan weakened a little bit during market hours as the company revealed that it borrowed against its revolver, according to a trader.

The term loan was quoted at 50½ bid, 53 offered, down from previous levels of 51 bid, 54 offered, the trader said.

"Obviously drawing the revolver is not great news," the trader added.

In the bonds, traders reported that the structure was mostly lower.

One trader saw the 9 1/8% notes due 2014 get "crushed" early in the day, falling to 8 bid, 9 offered. But the debt staged a comeback and ended higher on the day at 13. The trader also saw the 10 1/8% notes due 2016 "straddling 20."

At another desk, a trader said the 10 1/8% notes "got beat up," dropping 4.5 points to around 17.5. However, he added that the issue had dropped to around 10 before bouncing off those intraday lows.

The trader also saw the 8 7/8% notes due 2014 slipping more than 3 points to around 24, while the 9 1/8% closed about 3 points higher at 13.5.

Another source placed the 8 7/8% notes at 24.5 bid, 3 points weaker on the day.

On Thursday, Freescale said that it drew down approximately $184 million under its revolver to improve financial flexibility.

The company previously received $460 million under its revolver in October.

Lehman, who has a $60 million commitment under the revolver, did not honor the company's borrowing request.

Freescale is an Austin, Texas-based designer and manufacturer of embedded semiconductors for the automotive, consumer, industrial, networking and wireless markets.

Unvision loan gains strength

Univision Communications' term loan B gained a couple of points during the trading session after the company announced that it settled its lawsuit with Grupo Televisa SAB, according to a trader.

The term loan B was quoted at 51 bid, 53 offered, up from Wednesday's levels of 46 bid, 48 offered, the trader said.

The trader remarked that prior to the news on Thursday, the term loan B was quoted as low as 43 bid, 45 offered, but then it popped up right after the news hit.

In connection with settling and dismissing the lawsuit, Univision and Televisa revised the current Program License Agreement, which runs through 2017, resulting in increased payments to Televisa in exchange for incremental rights for Univision.

"We are pleased that today's settlement concludes this time-consuming litigation. This settlement serves the best business interests of both Televisa and Univision. It assures the public that Univision will continue to have access to consistently top quality Hispanic programming. It enables Televisa to continue utilizing Univision's extensive television networks as an important distribution channel for its content into the U.S. marketplace. For Univision, it assures that there will be no disruption in some of its most popular and valuable programming, as well as affording Univision an ongoing pipeline of future content developed by Televisa," the companies said in a statement.

Univision is a Los Angeles-based Spanish-language media.

Charter bonds up, down

Bankruptcy chatter continued to plague Charter Communications, as some market players saw the company's debt trading without interest.

A trader called the 11% notes due 2015 "maybe a touch better" at 17.5 bid, 18 offered versus levels of 16.5 bid, 17 offered on Wednesday. He noted that trading was "not all that active."

Another trader quoted the "old" 10¼% notes at 51.5 bid, 52.5 offered and the "new" 10¼% notes due 2013 at 42 bid, 46 offered. That latter, he added, was trading flat.

Yet another source called the 8% notes due 2012 1.5 points weaker at 83 bid.

Charter recently missed a coupon payment, which had put pressure on the company's debt. But the missed coupon only proved to be more evidence that a Chapter 11 filing was imminent. The St. Louis-based company founded by Paul Allen had already announced that it had hired Lazard LLC to open discussion with bondholders. New reports published early this week indicated that the company has also hired bankruptcy advisors and that a filing could come as early as next week.

"At some point," a trader said when asked if he thought the highly leveraged company would file. "Don't know how soon it will be, but sure.

"I don't know why it's surprising though," he added. "They have been playing musical chairs for awhile now."

Broad market mixed

Dillard's Inc.'s 7 1/8% notes due 2018 fell 3 points to 35.5 bid.

A trader said Washington Mutual Inc.'s holding company paper continued to gain steam, the seniors - like the 4% notes due 2009 - moved up to 76, while the subordinated issues - like the 8½% notes due 2010 - ended higher at 41 bid, 42 offered.

Amkor Technology Inc.'s 7 1/8% notes due 2011 traded actively, a trader said, with $25 million changing hands. However, the trader said the bonds closed unchanged at 71 7/8.

Trump Entertainment Resorts Inc.'s 8½% notes due 2015 were seen largely inactive following news that the company's forbearance was extended. A trader said a "very small" trade went through at 15.5.

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