Greyhound Financial Corp. could carve the first issue from its new $750 million shelf registration as early as next month, a company official said yesterday.
Meilee Smythe, vice president and assistant treasurer at Greyhound, said that while the company could take down debt from yesterday's shelf registration with the Securities and Exchange Commission as early as September, no definite schedule has been set.
"It's a function of what our cashflow needs are," Ms. Smythe said. The debt can be issued as senior debt or medium-term notes, she said.
Underwriters, she said, are Merrill Lynch & Co., Goldman, Sachs & Co., Citicorp Securities Markets Inc., Lehman Brothers, and Salomon Brothers Inc. Proceeds will be used for general corporate purposes, she added.
Greyhound filed its previous shelf registration last January, also totaling $750 million, Ms. Smythe said. Out of that, the company did three public underwritings totaling $425 million and issued $325 million of medium-terms notes, the last of which was issued just a few weeks ago, she said.
Asked if yesterday's shelf registration would follow the same patter, Ms. Smythe said it was difficult to say.
Yesterday, Fitch Investors Service Inc. gave an A rating to Greyhound's shelf registration, according an agency release. The credit trend is stable.
"The rating reflects the company's good and more predictable asset quality, strong management, and solid balance sheet," a Fitch release says. "Greyhound Financial's asset quality, the single most important variable for the company, has held up fairly well throughout the recession."
In secondary activity yesterday, high-yield bonds lost 1/2 point in both the better-quality and distressed sectors, traders said. Also yesterday, Savin Corp. filed for Chapter 11. High- grades sympathized with the Treasury market's weak dollar worries, moving lower in extremely quiet trading.
"Apparently, most people are still long a lot paper," one high-grade trader said. He noted, however, that spreads to Treasuries have tightened a bit because people are unwilling to lose their paper at such low yields.
As for yesterday's new-issue activity, $200 million of new debt issued by RJR Nabisco Inc. proved a highlight, the trader said, adding that the current unfavorable interest rate climate appeared to have sidelined many issuers.
Federal Home Loan Banks issued $240 million of floating-rate notes due 1995 at par. The notes float monthly at 80 basis points under the cost of the funds index and pay quarterly. Merrill Lynch managed the offering.
RJR Nabisco issued $100 million of 7,625% senior notes due 2000. The noncallable notes were priced at 99.499 to yield 7.71% or 130 basis points over interpolated eight-year Treasuries. Donaldson, Lufkin & Jenrette Securities Corp. lead managed the offering.
In a separate deal, the company issued $100 million of 6.80% senior notes due 2001 at par. The noncallable notes were priced to yield 105 basis points over when-issued five-year Treasuries. The offering contains a provision allowing the investors to put the securities back to the issuer at par after five years. Citicorp Securities Markets lead managed the offering.
Comdisco issue $100 million of 7.750% senior notes due 1999. The noncallable senior notes were priced at 99.569 to yield 163 basis points over comparable Treasuries. Moody's Investors Service rates the offering Baa2, while Standard & Poor's Corp. rates it BBB. Smith Barney, Harris Upham & Co. managed the offering.
Iowa Southern Utilities Co. issue $30 million of 7.25% first mortgage bonds due 2007. Noncallable for 10 years, the bonds were priced at 98.18 to yield 7.454 or 78 basis points over 10-year Treasuries. Moody's rates the bonds Aa3, while Standard & Poor' rates them AA. Goldman Sachs won competitive bidding to underwrite the offering.
Wisconsin Natural Gas Co. issued $25 million of 6.125% debentures due 1997 at par. The noncallable debentures were priced to yield 42 basis points over comparable Treasuries. Moody's rates the offering Aa3, while Standard & Poor's rates it AA. Kidder, Peabody & Co. sole managed the offering.
Duff & Phelps Credit Rating Co. reaffirmed its AA rating of Hydro-Quebec's medium-term note program. The Canadian company recently won permission to increase the limit on its program to $2 billion from $1 billion, a Duff & Phelps release says.
"Hydro-Quebec has a relatively low cost structure and has demonstrated a commitment to maintaining appropriate coverages and capital ratios," the release says.
It adds, "Management has responded quickly to variable runoff conditions of recent years, and to changing domestic and export market circumstances.
Standard & Poor's has put North American Philips Corp.'s BBB-plus senior long-term debt and A-2 commercial paper ratings on CreditWatch with negative implications.
North American Philips is a subsidiary of Netherlands-based Philips Electronics NV, Europe's largest consumer electronics manufacturer.
"This action follows continued weakness in Philips' key consumer electronics business, which in turn reflects low levels of consumer demand and price cutting," a Standard & Poor's release says.
Philips is about 18 months into a comprehensive restructuring program geared toward improving profitability and the group's competitive position.