Winn-Dixie, UAL lower; bank loans seen quiet; Calpine hovers around issue levels

By Paul Deckelman and Sara Rosenberg

New York, March 15 - Winn-Dixie Stores Inc. bonds were quoted down more than three points on Monday, although there was no fresh news out on the troubled Jacksonville, Fla.-based supermarket company.

Also on the downside was UAL Corp., losing altitude in apparent sector sympathy after Delta Airlines forecast a wider than originally anticipated loss.

Calpine Corp.'s new bank debt and junk bonds hovered around their Friday issue price, amid what was seen as generally quiet dealings in the bank loan market.

"It could not have been any quieter," a trader in distressed bank loan paper said. "We did two trades today. Now that's quiet."

Calpine Generating Co. LLC's (CalGen) $2.405 billion refinancing broke for trading on Monday with the with the first-lien term loan/note tranche hitting plus par levels and the second lien term loan/note tranche moving down from its original offer price.

The $835 million five-year first lien term loan/note, which was issued at par, was quoted at 100.25 bid, 100.5 offered, according to a trader, while the $740 million six-year second lien-floating rate loan/note, which was issued at 98.5, was quoted at 97 bid, 98 offered.

A bank debt market source indicated that this might be because this particular paper is held by "more hedge fund guys", who are more likely to dump an issue if it starts to fall back than the usual buy-and-hold bank-debt-investor.

Another trader said that "speculation is that Morgan Stanley is holding a lot of the paper," the trader added.

As for the new Calpine pure bonds, the third-priority floating-rate notes straddled their par issue price at 99.75 bid, 100.25 offered, while the sole fixed-rate instrument in the $2.4 billion financing package, the 11½% notes due 2011, dipped to 99 bid, par offered from their Friday issue price at par.

Calpine's existing 8½% notes due 2010 meantime fell back to 91 bid from 92.5 on Friday, while its 8 ½ notes due 2011 retreated to 74 bid, down from 76.25.

Winn-Dixie falls as market eases

Elsewhere, the Winn-Dixie bonds were heard by a trader "softer amid the carnage" in a generally softer high yield market.

He quoted the company's 8 7/8% notes as having opened around 87 bid, 88 offered, down from Friday's levels around 88.35 bid. He saw the bonds drop to 84.5 bid, 86.5 offered before recovering slightly from their lows to end at 88.5.

He noted that the bonds had firmed to above the 88 level previously and "the stock was up - but now they're just mucking around" at the lower levels, on "no news and no flows."

UAL's bonds were "down a couple of points," a distressed-debt trader said, adding: "I don't know of any news - just on sympathy" with the other airline issues, which retreated on the Delta warning.

He quoted UAL's 9% notes as having fallen back to 13 bid, 14 offered from prior levels around 15.5 bid, 16.5 offered.

At another desk, a trader saw the bankrupt Chicago-based airline's bonds down a point at 14 bid, 15 offered.

Delta, meanwhile - which had warned in a filing with the Securities and Exchange Commission that it expects to post a first-quarter loss of about $400 million due to higher fuel costs, a wider loss than its mid-January estimate of a loss between $300 million and $350 million for the quarter - was lower, its 7.70% notes due 2005 dipping to 86 bid, 87 offered from 89 bid, 90 offered previously.

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