Issuers sent roughly $3 billion of fresh debt into the corporate market yesterday after the week's slow start.

"The [long] bond is up pretty near the highs, and I think a lot of deals were just sitting on the shelf waiting for the next opportunity, and they got it." a source at one syndicate desk said.

A buyside source added that some issuers appear to be testing the market to see how aggressively they can price their offerings.

If they can sell at those levels, they do. If not, they cheapen the deal five basis points and it moves, the source said.

In other news yesterday, Time Warner Inc. said it will redeem $900 million principal amount of its 8 3/4% convertible subordinated debentures due 2015.

July 9 is the redemption date, the company said in a release. Time Warner plans to pay $1,061.25 plus $1.94 of accrued interest to the redemption date or a total of $1,063.19 for each $1,000 principal amount of the debentures.

Roughly $3.15 billion of the debentures are outstanding. Chemical Bank selected the $900 million being called by lot, and holders will receive notification by mail, the release says.

The bank, which is trustee for the debentures, will act as paying agent, the release says.

In other action, Bally's Casino Holdings Inc. closed a private placement of senior discount notes due 1998, according to a release issued yesterday by parent company Bally's Manufacturing Corp.

Proceeds from the offering will be used to finance gaming ventures in New Orleans; Tunica and Biloxi, Miss.; and elsewhere, the release says.

The offering was originally expected to have proceeds of $75 million, but proceeds reached closer to $130 million when the deal was increased, a source familiar with the deal said. "The investment community's response to this offering by purchasing these notes in quantities in excess of our original plans demonstrates confidence in Bally management's strategic plans to grow the company's casino operations." Arthur M. Goldberg, Bally's Manufacturing's chairman, president, and chief executive officer, said in the release.

In other news, Goldman, Sachs & Co. issued a statement late Wednesday on a lawsuit brought by investment adviser PPM America Inc. on behalf of Jackson National Life Insurance Co. The securities fraud and fraudulent conveyance suit involves a 1988 leveraged buyout of Bucyrus-Erie Co. and some subsequent transactions. Jackson, a Michigan-based insurer, holds $60 million of Bucyrus-Erie bonds.

"This is a frivolous complaint without any merit whatsoever," Goldman's statement says. "Jackson National is a $16 billion, sophisticated insurance giant who, following [its] own due diligence review, made a private placement investment in Bucyrus-Erie in June 1990, more than two years after the original leveraged buyout was completed.

"The company has been operating in a depressed industry in a difficult economy," the statement continues. "Jackson National and their investment adviser, PPM America, are apparently upset and are trying to hold someone up because their investment in Bucyrus-Erie hasn't fared well."

In secondary trading, high-yield bonds gained 1/8 to 1/4 points over all. Gainers included Stone Container Corp. bonds, which gained about 1/2 point on the strength of some new issues. The company issued $250 million of privately placed convertible debt and $150 million of public senior unsecured debt off the shelf. Spreads on high-grade bonds were unchanged.

New Issues

Commonwealth Edison issued a two-part first mortgage bond offering totaling $375 million.

The first tranche consisted of $225 million of 7% bonds due 2005. The noncallable bonds were priced at 99.925 to yield 7.009% or 115 basis points over 10-year Treasuries. The second piece consisted of $150 million of 7.50% bonds due 2013. The noncallable bonds were priced at 98.867 to yield 7.611% or 87.5 basis points over 30-year Treasuries. Moody's Investors Service rates the offering Baa2, while Standard & Poor's Corp. and Duff & Phelps Credit Rating Co. rate it BBB. Painewebber Inc. was lead manager of the offering.

Bankers Trust New York issued $300 million of 4.70% senior notes due 1996. The noncallable notes were priced at 99.861 to yield 4.75% or 31 basis points over comparable Treasuries. Moody's rates the offering Al, while Standard & Poor's and Duff & Phelps rate it AA. Goldman Sachs was lead manager of the offering.

Federal Home Loan Mortgage Corp. issued $300 million of 4.80% step-up notes due 1998 at par. Noncallable for two years, the coupon on the notes steps up to 5.80% on July 7, 1995. Goldman Sachs managed the offering.

Federal National Mortgage Association issued $300 million of 5.32% medium-term notes due 1998 at par. Noncallable for a year, the notes were priced to yield 16 basis points over comparable Treasuries. Merrill Lynch & Co. managed the transaction.

Weyerhaeuser issued $250 million of 7.25% debentures due 2013 at par. The noncallable debentures were priced to yield 50 basis points over 30-year Treasuries. Moody's rates the offering A2. while Standard & Poor's rates it A. Duff & Phelps rates it A-plus. Morgan Stanley & Co. was lead manager of the offering.

Merrill Lynch & Co. issued $250 million of floating-rate medium-term notes due 1994 at par. The noncallable notes float daily at 20 basis points over the federal funds rate. They pay quarterly. Moody's rates the offering Al, while Standard & Poor's rates it A-plus. Duff & Phelps rates it AA-minus. Merrill Lynch managed the offering.

Merrill Lynch & Co. issued $250 million of floating-rate medium-term notes due 1994. The noncallable notes float quarterly at five basis points under the three-month London Interbank Offered Rate. They pay quarterly. Moody's rates the offering Al, while Standard & Poor's rates it A-plus. Duff & Phelps rates it AA-minus. Merrill Lynch managed the offering.

The Kroger Co. issued $200 million of 8.5% senior secured notes due 2003 at par. The notes are callable after five years at 104.25. Moody's rates them Ba2, while Standard & Poor's rates them BB-minus. Duff & Phelps rates them BB. Citicorp Securities Markets Inc. was lead manager of the offering.

Alabama Power issued $150 million of 7.45% first mortgage bonds due 2023. Nonrefundable for five years, the bonds were priced at 98.737 to yield 7.557% or 83 basis points over comparable Treasuries. Moody's rates the offerin" Al, while Standard & Poor's and Duff & Phelps rate it A. A group led by Lebman Brothers won competitive bidding to underwrite the offering.

Baltimore Gas & Electric issued $125 million of 6.125% first and refunding mortgage bonds due 2003. The noncallable bonds were priced at 98.827 to yield 6.285% or 42.5 basis points over comparable Treasuries. Moody's rates the offering A1. while Standard & Poor's rates it A-plus. Duff & Phelps rates it AA-minus. Citicorp Securities Markets Inc. won competitive bidding to underwrite the offering.

General Electric Capital Corp. issued $100 million of 3.5% medium-term notes due 1994. The noncallable notes were priced at 99.941 to yield 3.561% or seven basis points over the year Treasury bill. Moody's and Standard & Poor's rate the offering triple-A. Duff & Phelps rates it AA-plus. Kidder, Peabody & Co. sole-managed the offering.

Bank of Boston issued $100 million of 6.875% subordinated notes due 2003. The noncallable notes were priced at 99.866 to yield 6.893% or 103 basis points over comparable Treasuries. Moody's rates the offering Baa2, while Standard & Poor's rates it BBB-minus. Duff & Phelps rates it BBB. Merrill Lynch lead-managed the offering.

Kansas City Southern Industries Inc. issued $100 million of 5.75% senior notes due 1998. The noncallable notes were priced at 99.623 to yield 5.838% or 66 basis points over comparable Treasuries. Moody's rates the offering Baa2, while Standard & Poor's rates it BBB-plus. Merrill Lynch was lead manager of the offering.

Delmarva Power & Light issued $90 million of 6.40% first mortgage bonds due 2003 at par. The noncallable bonds were priced to yield 54 basis points over comparable Treasuries. Moody's rates the offering A2, while Standard & Poor's and Duff & Phelps rate it A-plus. Morgan Stanley was lead manager of the offering.

Ohio Edison issued $75 million of 7.625% first mortgage bonds due 2023. Noncallable for 10 years, the bonds were priced at 99.05 to yield 7.706% or 97 basis points over comparable Treasuries. Moody's rates the offering Baa2, while Standard & Poor's rates it BBB. Duff & Phelps rates it BBB-plus. Morgan Stanley & Co. was lead manager of the offering.

CBI Industries issued $75 million of 6.25% senior notes due 2000. The noncallable notes were priced at 99.604 to yield 6.321 % or 80 basis points over comparable Treasuries. Moody's rates the offering Baa2, while Standard & Poor's rates it BBB. Merrill Lynch was lead manager of the offering.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.