The Distressed Debt Report - November 7, 2006

SEC Allowing More Loans to Publicly Traded Companies

The Securities and Exchange Commission adopted new rules last month that will relax some restrictions on business development companies, allowing them to invest more in publicly traded companies and in companies that have already issued debt securities. Full Story

Nellson Bankruptcy Heralds Aggressive New Tactics by Equity-holders

The acrimonious Chapter 11 bankruptcy case of Nellson Nutraceutical is raising concern among lenders about new ways that equity-holders can exert influence over bankruptcy proceedings. Full Story

The volume of collateralized loan obligations containing middle market loans may more than double this year as more asset managers diversify into the space. Full Story

• Second Lien Spreads Tighten in October
• Auto Sector Woes Weaken Position of Meridian's Second Lienholders
• Morgan Stanley Buys Stake in Avenue Capital
• Zwirn Said to Cop to Inappropriate Expenses
• Monroe Expands into Co-Lending
• Canyon Starts International Credit Fund, Led by Former TCW Manager
• Fortress Takes Newspaper Publisher Public to Redeem Debt

In Other Middle Market Deals, LaSalle Refinances Furniture Company

German bank WestLB's global energy group provided $298.5 million in senior credit facilities for White Energy Holding Co. to acquire ethanol production plants and refinance older debt. Full Story