The Distressed Debt Report - October 7, 2005

Variety of Lenders Sprout in Booming Sector

High energy prices and a lack of attractive investment alternatives have fuelled a torrid pace of investment in energy companies over the last several quarters, with hedge funds, business development companies, and other capital providers aggressively moving into the sector. Loans to oil and gas companies totaled almost $79 billion through three quarters of this year compared with nearly $88 billion for all of 2004, according to Loan Pricing Corp., which collects and analyzes loan data. Full Story

Tech, Life Science Companies See More Borrowing Options

Jack Gaziano, national sales manager for the commercial finance unit of Silicon Valley Bank in Santa Clara, Calif., didn’t seem so surprised to have lost out on the recent deal to provide $12 million in acquisition financing to a small technology company. It was who he had lost out to that came as the shock: a regional savings bank that used to avoid high-tech customers. Full Story

Beginning this month, going broke is going to cost a lot more. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 is likely to increase the amount of cash a company needs to file for bankruptcy. In many cases, struggling companies will need to secure larger DIP loan commitments or be forced to liquidate assets rather than restructure, according to bankruptcy attorneys. Full Story

Finance company CapitalSource raised $393.3 million in a secondary public stock offering, taking advantage of its rising share price since announcing plans to convert into a real estate investment trust. Full Story

Marquette Combining Asset-Based Lending Units

Marquette Financial, the commercial finance company controlled by billionaire Carl Pohlad, is combining two asset-based lending businesses and opening new offices…

Surge Capital Provides $425M Credit Line for ZAP

Surge Capital, a firm specializing in purchase order financing, provided a $425 million credit line for ZAP, an automotive company with less than $5 million in annual revenue and a history of losses and negative cash flow…

Shaw, BofA Waive Boyds Collection Default on $55M in Loans

Bank of America and D.E. Shaw Laminar Portfolios agreed not to accelerate payments of The Boyds Collection’s debt or to seize its assets after the maker of teddy bears and other collectible items defaulted on $55.5 million in loans…

BofA Places $722.5M Credit

Facility for Allied Capital Banc of America Securities arranged $722.5 million in revolving credit for middle market lender Allied Capital to be provided by 18 banks. The three-year unsecured facility can be expanded up to $922.5 million at the company’s option…

Prentice Teams with Veteran Retail Exec to Bail out Whitehall Jewelers

Prentice Capital Management and long-time retail executive Seymour Holtzman provided $30 million in bridge loans to Whitehall Jewelers and agreed to provide $30 million more in convertible debt. The financing will give Prentice control of the chain of 380 jewelry stores and stop it from running out of cash…

Evercore Names New Heads of Restructuring Practice

Boutique investment bank Evercore Partners named veteran turnaround advisors Bill Repko and David Ying as co-heads of its restructuring group…