Ply Gem bonds move around; CIT Group seen lower; Capmark busy; Cumulus term loan firmer again

By Paul Deckelman and Sara Rosenberg

New York, June 23 - Distressed-debt traders saw another relatively sedate session, although here and there a name stood out.

A trader saw some volatility in Ply Gem Industries Inc.'s bonds, which gyrated in the low to mid 60s, although there was no specific news seen to have acted as a catalyst to those movements.

CIT Group Inc. paper was seen taking its lumps - one of several financial names that were seen trading, including Capmark Financial Group Inc. However, there was considerably less activity in the recently busy E*Trade Financial Corp.

In the bank debt market, Cumulus Media Inc.'s term loan rode the momentum generated from its earlier news that that the company is looking to amend its credit facility,

Ply Gem popping around off lows

A trader said that Ply Gem Industries' 11¾% notes due 2013 "were pretty active today," although there was no fresh news seen on the Kearney, Mo.-based maker of doors and windows for the residential building industry.

"It looks like they traded off, but then came back," he said, recounting their journey from Monday's levels around 661/4, down to Tuesday's low at 63, and their rebound back up to 66." He saw the bonds finally going out at 64¼ bid.

"They were kind of all over the lot. They traded off and then popped back up. For them it was relatively active.

"Net-net they were off on the day, but with some gyrations."

CIT gets smacked around

CIT Group paper "was getting beat up," a trader commented. He said the New York-based commercial lender's paper - recently lowered to full junk bond status from its formerly investment-grade ratings - "has been getting knocked around."

He said the longer-dated issues like its 7½% notes due 2013, had moved into the upper 50s from levels in the mid-60s at the end of last week, so, "it's down a good bit."

He saw its 7 5/8% notes due 2012 moving down to the 69 area Tuesday from 73 on Monday.

He did not see any specific news about the company that might explain the bonds' sudden unpopularity.

Capmark trades actively...

Elsewhere among the financials, a trader said that Capmark Financial Group's "traded up a little bit," although there was no fresh news out on the Horsham, Pa.-based commercial lender. He said the bonds "were down, and now they're sort of working themselves back up."

He saw its floating-rate notes due 2010 go home around 37 bid, 39 offered, while its 5 7/8% notes due 2012 traded up to 26 bid.

A market source at another shop noted that the 2012 bonds were busily traded during the day, with a number of big-block round lot transactions. He saw those bonds open slightly below Monday's 26 close and then gyrate in a narrow 2 point range before finally going home essentially unchanged at 26. More than $10 million of those bonds were seen changing hands.

Another trader said "it looked like there was a lot of trades" in the name, seeing the '12s get as good as 27 before going out at 26, "up a little bit." He said those bonds had been in a 25 3/8- 25½ context on Monday, "so I'd say that's a little better on the day."

...but E*Trade activity trails off

The first trader saw E*Trade Financials Corp.'s bonds "not really active at all," on Tuesday - a switch from the busy trading levels and explosive upside moves seen over the last five sessions after the company announced that some of its bonds would be taken out.

"It was pretty quiet. The stock was somewhat volatile, which I think has an impact on what bonds are doing - but today was the definitely the quietest day since the announcement" last week that the New York-based online financial services company would exchange new convertible debt for all of its 8% notes due 2011 and its 12½% springing lien notes due 2017, which had caused both of those issues to surge by more than 30 points over several sessions to levels well above par.

He called the levels "about unchanged," with the 8s continuing to trade in a 108-110 range, the 121/2s around 104-106, and the company's other two issues not being exchanged for, its 7 3/8% notes due 2013 and its 7 5/8% notes due 2015 in an upper 70s-80ish context.

Another trader saw the 7 3/8s down a point at 82, on one round-lot trade, while the 121/2s were "not too much different" from Tuesday's levels around 106-107, with "not a lot of trading in the name today."

Hovnanian hangs in there

A trader said that Hovnanian Enterprises Inc.'s bonds "just weren't that active," even with Monday's announcement that the Red Bank, N.J.-based homebuilder would take out one small issue of bonds and would tender for a portion of eight other issues.

He saw its 11½%notes due 2013 trading between 85 bid and 86, "maybe a smidge lower" on the session.

A market source at another desk, however, saw the company's 6 3/8% notes due 2014 at 52 bid, having given up the 3 or 4 point gain it had notched on Monday.

But yet another source pegged the company's 6½% notes due 2014 better by 2 points on the day at 56 bid.

Hovnanian said Monday that it plans to buy back all $28.87 million of its outstanding 6% senior subordinated notes due 2010, paying a price in the upper 90s, and will spend up to $60 million to buy back portions of eight other series of bonds via a pair of Dutch auction tender offers.

Cumulus term loan turns up

In the bank debt market, Cumulus Media's term loan was stronger during the trading session in follow through from news earlier this week that the company is looking to amend its credit facility, according to a trader.

The term loan was quoted at 64½ bid, 66½ offered, up from Monday's close of 64 bid, no offers and Monday morning levels of 62 bid, 66 offered, the trader said.

On Monday, the Atlanta-based radio broadcasting company launched an amendment to lenders that would give covenant relief and on Tuesday afternoon a second lender call was held.

In return for the covenant changes, the company would increase pricing on the term loan to Libor plus 400 bps from Libor plus 175 bps and repay some of the debt.

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