PrefBlog

Connor Clark has announced:

that Lear Corporation has reached agreement on a consensual debt restructuring under court supervision pursuant to a voluntary bankruptcy filing under Chapter 11 of the United States Bankruptcy Code. This plan is expected to constitute a credit event under the credit linked note (“CLN”) issued by TD Bank to which the Company has exposure.

Given the unprecedented economic downturn and corresponding decline in global automobile production volumes, as well as continued difficult conditions in credit markets generally, Lear’s Board of Directors concluded that this action was the fastest and most effective way to de-lever its capital structure.

The recovery rate for ROC Pref III Corp. is fixed at 40%. As a result, the Lear credit event is expected to reduce the number of additional defaults that ROC Pref III Corp. can sustain before the payment of $25.00 per Preferred Share at maturity is adversely affected by 1.0 to 1.6.

They provide a table:

There are 127 names in the reference portfolio, with 6.0 defaults as of 2009-3-31; on that date there were 17 non-defaulted junk names. The death watch continues.

RPB.PR.A was last mentioned on PrefBlog in connection with December’s credit event for Tribune Corp..

RPB.PR.A is not tracked by HIMIPref™.

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