Natwest Markets led its first high-yield bond last week, entering a challenging market with a $200 million issue for Anacomp, a maker of microfiche equipment.

Interest rate fears have recently reduced the euphoria over junk bonds. Investors pulled about $250 million out of high-yield funds in the past week, the largest such outflow in about a year, said market experts.

"The outflows didn't make the deal any easier," said Roger Hoit, a director at Natwest.

At the same time, Natwest, which started its high-yield business last September and has co-managed seven deals since then, took the unprecedented step of selling the bonds for the CCC-rated company without the typical one-week road show.

"We had a one-hour road show," said Donald L. Viles, chief financial officer at Indianapolis-based Anacomp. "I was nervous about what's going to happen with interest rates" and wanted to come to market quickly, he said.

Mr. Hoit agreed, saying Natwest feared it might have missed Anacomp's rate target if it hadn't come to market quickly.

In addition, Natwest wanted to sell the bonds before losing the focus of investors who attended the Credit Suisse First Boston high-yield conference in Arizona late last week.

The new bonds offered a yield of 11.25%; they refinance 13% subordinated notes Anacomp issued last June after it emerged from bankruptcy.

Executives at Natwest and Anacomp were singing the praises of a deal they considered a genuine challenge.

"We're very pleased," said Mr. Viles. "We did the deal in a week. It's hard to imagine that you can do it any faster than that. Our only disappointment could be if the interest rates went lower."

Mr. Viles said Anacomp chose Natwest to lead its transaction because the bank was the first to suggest a refinancing of the company's subordinated debt.

Matthew Gourlay, a managing director and head of high-yield sales, trading, and research, called this one of the sweetest transactions of his 19-year career in the junk bond business.

"Lehman and Donaldson Lufkin & Jenrette, two preeminent investment banking firms, were the banking customer clients for Anacomp, and sometime in December we interjected ourselves in this transaction."

Mr. Gourlay said that all the bank's other transactions would seem easy by comparison.

Indeed, some investors said they were pleased with the deal and that the bonds are holding their value. "The whole high-yield market is down about two points, so the Anacomp bonds have probably outperformed the rest of the market," said one investor.

To be sure, some market sources said a number of investors opted not to buy the deal because they hadn't had time to evaluate it and because Natwest hasn't yet established a track record in support of challenging deals.

"The fact that people didn't even look at it is a negative," said an investment banker at another firm. "Investors just passed on the deal."

Mr. Gourlay attributed some of the negative sentiment surrounding the deal to a fiercely competitive marketplace that is anything but happy with the entrance of a new lead-manager.

"A lot of people don't want our firm to succeed," he said.

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