Post-holiday market resumes as USG, Oshkosh price; new USG bonds jump; Walter gets whacked

By Paul A. Harris and Paul Deckelman

New York, Feb. 17 – It was back to work on Tuesday for the high-yield market following the long Presidents’ Day holiday weekend.

Junkbondland saw its first dollar-denominated, fully high-yield-rated issues price since last Wednesday, as two quickly shopped, single-tranche offerings totaling $600 million came to market.

USG Corp. priced $350 million of 10-year notes, while Oshkosh Corp. brought in a $250 million 10-year issue.

Elsewhere in the primary arena, price talk and timing came out on the $1.9 billion eight-year notes deal that will help fund the leveraged buyout of PetSmart, Inc.

Dean Foods Co. was heard to be hitting the road to market a $700 million issue of eight-year notes.

Traders said that the new USG bonds firmed smartly in busy dealings when they moved into the aftermarket. The new Oshkosh paper, which priced later in the session, was slightly higher.

There was also active trading in last week’s split-rated 10-year issue from Wynn Las Vegas LLC.

Away from trading in new and recently priced deals, traders saw Walter Energy, Inc.’s bonds sharply lower after the coal producer reported a wider-than-expected fourth-quarter loss.

Statistical indicators of junk market performance were mixed for a second straight day on Tuesday.

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