Oneida bank debt active after fall to lower levels; Dan River bonds ease

By Paul Deckelman and Sara Rosenberg

New York, July 9 - A chunk of Oneida Ltd.'s bank debt traded on Friday in a 92ish context a trader said - up a little from the lows to which that paper had fallen earlier in the week.

Among bond investors, Dan River Inc.'s notes were seen down a point, although trading in the name was by no means active.

Flatware, cutlery and crystal maker Oneida, based in the upstate New York city of the same name, had dropped by about a point on Wednesday to the 91.5 bid, 92.5 offered area on no specific news, but that paper has managed to pretty much hold steady at those levels since then, and appeared to have firmed a little off those lows Friday.

"It was pretty volatile for a while so it's no surprise that it traded," the trader added.

But even though some distressed-debt investors are playing in the company's loan, nobody is saying to stick a fork in Oneida because they're done.

On Wednesday, Oneida announced that it signed a letter of intent to sell substantially all of the assets of its Encore Promotions Inc. subsidiary to Bradshaw International Inc. and also to enter into a licensing agreement with Bradshaw. The sale is expected to be completed by July 31. Terms were not disclosed.

Oneida said that the sale of the non-core asset would enable it "to focus our resources on core operations," such as flatware and dinnerware, "while continuing to pursue opportunities for market growth."

However, this announcement was not unexpected, so it was already priced into the debt, traders said.

Winn-Dixie ignores Moody's cut

Bond traders were saying pretty much the same thing about Winn-Dixie Stores Inc., after Moody's Investors Service lowered all of the Jacksonville, Fla.-based supermarket operator's ratings, including that of its 8 7/8% senior notes due 2008, which were cut to B3 from B1.

Those notes remained in the same 94-95 context in which they had recently traded.

"The bonds were already trading to the downgrade," a trader opined. "The ratings agencies are behind the curve."

Moody's said that its late-Thursday downgrade of the company's senior implied rating to B1 from Ba3 "was prompted by (1) Moody's belief that the recent deterioration in revenue, margins, and debt protection measures will persist over at least the medium-term, (2) the challenges in winning back customers and market share from efficient conventional and non-traditional grocery competitors, and (3) the uncertain outcome of the announced asset rationalization program."

However, the ratings agency acknowledged that "supporting the rating is Moody's opinion that the company has good medium-term liquidity in spite of its operational issues."

The outlook is negative.

Dan River bonds edge down

Dan River's bonds were heard down a point or so to 28 bid, 30 offered from prior levels in a 29-30 context. The company's bank debt had eased Thursday in line with a general retreat in the bonds and debt of companies - particularly bankrupt ones - in the hard-hit U.S. textile business.

One catalyst behind their recent weakness has been market rumors that another name - New York-based Galey & Lord - might liquidate. That buzz has driven Galey & Lord's bank debt to levels under 40 bid lately.

Adelphia loans trade, bonds slip

Adelphia Communications Corp.'s bank debt traded a bit on Friday, with no real price change, as the Old Century paper was quoted at 96.75 bid, 97.25 offered and the New Century paper was quoted at 96 1/8 bid, 96 3/8 offered by the end of the day, according to a trader.

A bond trader meantime said that the bonds of the bankrupt Greenwood Village, Colo.-based cable operator "were down a couple of points."

He saw Adelphia's senior debt - which had recently traded a few points above par and which had still begun the week only a little below it - at 94 bid, 96 offered.

© 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.