hier das original

verfasst von mond73, 10.10.2000, 13:55

>Danke für den Beitrag. Davon werden wir bald viele lesen.


hoffe ich ja sogar, damit mein deuba-´put sich nicht völlig in luft auflöst. hier die ganze geschichte im original:


Deutsche Bank Financing Deal
With MainStream Hits Trouble
By PAUL M. SHERER
Staff Reporter of THE WALL STREET JOURNAL


Deutsche Bank AG may be on the hook for more than $1 billion after an aggressive financing commitment it made to wireless telecom company MainStream PCS Holdings LLC stumbled.

MainStream was formed in April to buy up wireless properties in Chicago and Cincinnati that Bell Atlantic Corp., GTE Corp. and Vodafone Group PLC were forced to divest before they could combine their wireless assets to form Verizon Wireless.

Several other Wall Street investment banks, including J.P. Morgan & Co. and Chase Manhattan Corp., turned down a chance to arrange $1.5 billion in junk bonds and syndicated loans for MainStream. But Deutsche, aggressively trying to push into the bulge bracket of the high-yield, or junk, market since its acquisition of Bankers Trust closed last year, stepped up and offered to do the whole financing itself.

Deutsche won the deal by committing to provide a $1.025 billion syndicated loan and a $435 million bridge loan to MainStream. Deutsche's promise to fund the deal was important in convincing Verizon to sell the properties to MainStream, said people familiar with the deal.

But so far MainStream has been unable to sell its junk bonds to investors, who view the deal as risky in an already tough market. And that has had a cascade effect on the rest of the financing package. MainStream had arranged $550 million in equity financing, but that money is deliverable only on the completion of the bond offer, with an additional $175 million deliverable during the 18 months after the offering. Likewise, loan investors won't buy chunks of the $1.025 billion loan from Deutsche until they see the bond priced. And MainStream can't buy the Verizon properties until it raises the funds.

A spokeswoman for MainStream, in Berwyn, Pa., declined to comment, and bankers at Deutsche Bank couldn't be reached Monday.

J.P. Morgan Capital to Buy Verizon Assets With Group (August 18)

MainStream, its bankers and its equity investors are now working hard on ways to restructure the financing so the deal can go forward, said people familiar with the situation. These people added that the equity sponsors, Deutsche Bank and MainStream all appear committed to seeing the deal through.

Typical ways to restructure such a deal would be to add more mezzanine funding, raise more equity, or sweeten the terms of the bond deal for investors, such as by throwing in more warrants and paying a higher yield. Alternately, the companies could go back to Verizon and try to negotiate a reduced purchase price, according to people familiar with the situation.

A Verizon Wireless spokesman said it wouldn't be appropriate for Verizon to comment about another company's finances, and said Verizon Wireless has fulfilled its obligation to regulators by putting the assets into a trust. The trustee, not Verizon, would be the one to sell the assets if they need to go back up for sale, he said. On June 29, MainStream signed a definitive purchase agreement to acquire the businesses from Verizon, paying $1.1 billion for the Chicago property and $280 million for the Cincinnati one.

MainStream had arranged commitments for the $550 million in equity from a pack of investors that included J.P. Morgan Capital Corp., Arlington Capital Partners, Carlyle Group, First Union Capital Partners, a unit of First Union Corp., Green Leaf Ridge Co. and Odyssey Investment Partners LLC.

The equity deal came with an interesting twist: the $140 million that Green Leaf Ridge arranged to go into MainStream would be the largest"minority equity investment" ever in telecom, Green Leaf Ridge said when announcing the investment in August. Green Leaf, a Chicago-based African-American private equity firm, had lined up its own funds and funds from several other minority investors.

MainStream is led by several former senior executives of Triton Cellular Partners LP, along with some key officials from Verizon's Chicago and Cincinnati operations. Raymond W. Smith, the former Bell Atlantic chairman and chief executive officer now with Arlington Capital, serves as chairman of the board of managers.

Deutsche launched the junk-bond deal into a market that has been on-again, off-again for months. Last week it was off, as money flowed out of bond funds and the stocks of telecom companies tumbled. On top of that, investors found MainStream's plan very aggressive.

The bond deal had already been downsized and made more attractive. The company last week was offering as much as 13.75% yield on $300 million in bonds and offered to throw in 4% of the company's equity in warrants, up from about 12% yield and 2% to 3% in warrants on the original deal for $435 million in bonds it tried to sell several weeks ago. MainStream pulled the latest version of the bond deal on Wednesday.

MainStream PCS hasn't yet taken money from Deutsche on either the syndicated loan or the bridge loan, and Deutsche isn't stuck for the entire $1.5 billion. It arranged for First Union and ABN Amro Inc. to lend $150 million each and contribute part of the bridge loan, in return for a bond underwriting spot. Wachovia participated in the syndicated loan and the bond, but not the bridge loan. Officials at First Union, ABN Amro and Wachovia couldn't be reached for comment.

Deutsche also has marketed the deal to other banks. In return for the banks agreeing to lend $50 million, the banks would earn $300,000 in fees for a role on the bond deal and a contribution to the bridge loan. However, it isn't clear if any other banks signed up for the deal.

In its bond prospectus, MainStream warns investors that the businesses it is acquiring in Chicago and Cincinnati have never generated a profit, and that"the losses will continue until our new service plan is accepted by consumers in our markets in sufficient quantities and at high enough prices to generate profits." And it said its heavy debt -- $921.7 million if the bond deal were completed -- could"require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness," cutting the amount of cash available for working capital, capital expenditures, research and development and other purposes.

-- Shawn Young contributed to this article




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