Three New High-Grade Issues Relieve The Week's Earlier Drought of Paper

After a dry spell early in the week, the high-grade corporate market yesterday welcomed issues from Texaco Capital Inc., National Rural Utilities Cooperative, and Commercial Credit Co. - among others.

"We had a good week last week, and we'll probably have a good week next week," Michael Bassett, a vice president at Stone & McCarthy Research Associates said, referring to dollar volume.

"It's just one of those pauses," he said of the quiet earlier in the week, adding that such pauses are typical for a Treasury auction week in August.

Texaco Capital issued $150 million of 30-year noncallable debentures. The 8 7/8 debentures were priced at 99.75 to yield 8.899%. Salomon Brothers managed the offering.

Later in the day, National Rural Utilities issued $150 million of 9% colateralized trust bonds, maturing in 2021 and noncallable for 10 years. The bonds were priced at 99.005 to yield 9.907%, or 110 basis points over comparable Treasuries. Lehman Brothers managed the deal.

Also yesterday, Commercial Credit Co. issued $100 million of 8% non-callable notes, maturing in 1996, priced at 99.794 to yield 8.05%, or 91 basis points over comparable Treasuries. Lehman Brothers managed the offering.

Late Wednesday, Federal Farm Credit Banks broke this week's dry spell when it issued $75 million of floating rate notes due in 1993 and priced over the three-month Treasury bill plus 20 basis. The offering floats weekly and pays quarterly. J.P. Morgan Securities managed the deal.

In other news, CNB Bancshares Inc. issued $15 million of 7.50% convertible subordinated debentures due in 2011. The debentures are convertible into common stock at $25.20, according to David L. Knapp, CNB Bancshares chief financial officer. Mandatory redemption provisions begin after 10 years, which will retire 75% of the offering by the final maturity date, he said. The debentures are redeemable at the company's discretion after the third year at a premium that declines on a pro-rata basis, Mr. Knapp said.

The company will use proceeds for general corporate purposes including pending and future acquisitions, advances to its subsidiaries, and debt reduction at the holding company level, he said.

Critical Care America Inc. called for a Sept. 30 redemption on all $39 million of its outstanding 7 3/4% convertible subordinated debentures due 2014. The redemption price is $1,069.75 plus accrued and unpaid interest of $35.52, for a total of $1,105.27 per $1,000 of the convertible debentures' principal amount.

Convertible debenture holders may convert the principal amount into the company's common stock, at 10 cents par value, on or before Sept. 30 at a conversion price of $26.25 per share.

"Our stock appreciation has been such that it's the right time," Patrick Smith, Critical Care's chief executive officer said. "The return to our bond holders will be substantial and we are confident that our financial status at this point makes sense to do that," he said.

The investment-grade corporate bond market was up about a 1/2 point traders said yesterday.

"It was a pretty active morning before noon time and then it was like some one rang a bell and at least corporates came to a halt," one trader said of mid-afternoon trading.

The high-yield market had a similar experience. While the morning proved failry busy, "the rest of the day faded into darkness," one trader said. The market had a firm tone and was up about an 1/8 to a 1/4.

In the private placement market recently, U.K. based Thorn EMI PLC closed a $30 million private placement deal last Friday, a source familiar with the deal said yesterday, Pricing information was unavailable at press time.

The company will use proceeds to pay down existing debt, he said. The National Association of Insurance Commissioners rated the deal A-1, its highest category. SPP Hambro & Co. acted as agent.

Elsewhere in private placements, Merrill Lynch & Co. priced a $24 million private placement deal for Alaska Airlines Inc. Details were sketchy, but one source said the transaction was to finance the debt portion of a leveraged lease deal for a McDonnell Douglas Corp. MD-83 passenger plane. The deal, expected to close next month, also contained $6 million of equity. Mid-western investors purchased the debt. Though unrated as yet, the source expected the offering would receive an NAIC-2.

Standard & Poor's Corp. has assigned an A-1-plus rating to Ciba-Geigy International Nederland B.V.'s Eurocommercial paper program. The program is guaranteed by Ciba-Geigy's parent, Switzerland-based Ciba-Geigy Ltd.

Fitch Investors Service Inc. rated Capstead Securities Corp. III's $200 million collateralized mortgage bond obligations series 1991-III at AAA. The rating primarily reflects the "excellent" quality of collateral and adequate credit enhancement level, in addition to "prudent" underwriting standards devised by Capstead Mortgage Corp. for acquiring mortgage loans.

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