The Distressed Debt Report - January 23, 2007

Hedge Funds Pursue Claims Against Wachovia for Borrower’s Alleged Fraud

Unfolding developments in Le-Nature’s Inc.’s almost three-month-old bankruptcy case have reawakened fears among banks that they can be targeted for losses caused by the financial misconduct of their borrowers. Full Story

But Construction Recovery Could Take Longer in Middle Market

Despite the bursting of the residential real estate bubble, there are signs that conditions are improving for manufacturers and suppliers of building materials. Lenders have expressed concern about the risk of defaults by building material suppliers since the housing market’s decline began last year. Full Story

Investors’ Suit Seen as Threat to Bankrupt Company’s Creditors

Minority shareholders in bankrupt Le-Nature’s Inc., facing combined losses of $33 million, have been frustrated in their attempts to bring a lawsuit against four top officers of the company. Full Story

• CLO Issuers Starting Quickly in 2007
• Fitch Keeps Faith in Allied Capital, Despite Legal Troubles
• Cargill Launching Clean Energy Mezzanine Fund
• Monomoy Closes $280M Restructuring Fund
• Amtrol Wins Court Approval for $115M Barclays DIP
• Energy Producer Saves $47.5M After Dispute with Former Affiliate

Oil Producer Raises $325M in Private Placement, Sbarro Repurchasing Debt

Bank of America arranged a $425 million syndicated term loan and a credit facility that will range from $200 million to $300 million for medical device maker Kyphon Inc. to finance an acquisition. The loan agreement was one of the biggest middle market debt financings in recent weeks. Full Story