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Clean Harbors Inc. Message Board

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  • Eggplant101 Eggplant101 Jan 12, 2000 7:24 AM Flag

    Who Holds the Debt?

    Thanks.

    Re: Bonds. The bonds were sold by
    First Boston in a registered offering in 1994, when
    CLHB's stock was much higher and Clinton and Gore were
    expected to spend a lot of federal money cleaning up the
    environment. The bond issue is small and CLHB is not a
    household name, with no research coverage from either the
    equity or debt side, and no investment banking
    relationships. The bonds probably never trade, or only very
    rarely, and the market must be extremely illiquid, with a
    wide bid/ask spread. Investment fund holders need to
    get market quotes from dealers to mark their
    portfolios. Fidelity & Guaranty Life Insurance Co. in
    Baltimore is shown holding $3.5 million of the bonds.
    Someone could call them up and ask them where they have
    their bonds marked.

    Re: why a bondholder might
    sell: bondholders don't buy bonds because the last
    coupon was paid, they buy because they expect the next
    coupon to get paid, and so on, and they expect to get
    paid their principal at maturity. The corporate bond
    market doesn't have the same pyramid scheme/greater fool
    market dynamic that you see in the equity
    market.

    Re: Bond covenants. Their are no restrictions on who
    can own CLHB bonds. Anyone can own them. They get
    them by buying them. After the company sold the bonds
    to First Boston in 1994, it no longer had any
    control over who owns them. Period. Still, I doubt LES/SK
    or any haz waste operator owns CLHB
    bonds.

    Re: Industry consolidation: SK has been an
    aggressive, albeit less than successful industry
    consolidator. Can anyone else fill this role? Who is a next
    likely acquisition candidate, beside our favorite CLHB?
    Can someone handicap WSTNA, DRTK, ITX, URS? Thanks.