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Arrangers Citibank/SSSB, Bank of America, Chase Manhattan and Dresdner Kleinmort Benson have launched the Eu3.2bn financing for Callahan Associates, to assist its acquisition of 55% of Deutsche Telekom's cable assets in North Rhine-Westphalia. This is the first of nine regions where DT is selling stakes in its cable network. The facility is split into a Eu2.95bn term loan, and a Eu250m revolver, both with a maturity of 9-1/2 years. The margin opens at 250bp over Euribor, and will ratchet down according to senior debt to Ebitda, with a possible low of 75bp.

Arrangers Citibank/SSSB, Bank of America, Chase Manhattan and Dresdner Kleinmort Benson have launched the Eu3.2bn financing for Callahan Associates, to assist its acquisition of 55% of Deutsche Telekom's cable assets in North Rhine-Westphalia. This is the first of nine regions where DT is selling stakes in its cable network. The facility is split into a Eu2.95bn term loan, and a Eu250m revolver, both with a maturity of 9-1/2 years. The margin opens at 250bp over Euribor, and will ratchet down according to senior debt to Ebitda, with a possible low of 75bp.

Market report: Compiled by Jim Webber, TD Securities, London, Tel: +44 20 7282 8216

UBS Warburg sold a Eu850m bond for Suez Lyonnaise des Eaux exchangeable into Fortis shares, which attracted positive, if muted, comment from the market. The bond was limited by the constraints of two existing equity linked issues for Fortis, a Dfl 1.5bn issue from October 1998 and a Eu575m deal, managed by Warburg's in June 1999. With both of these trading around issue price, bankers said it was difficult to find a new attraction for this deal.

Chase Manhattan this week made five senior hires in its New York structured credit products group, which comprises collateralised debt obligations and credit derivatives. To co-head its still small credit derivative trading business, the bank has hired Adrian Hyde, head of credit derivatives trading in the Americas at JP Morgan, and Richard Kennaugh, who held a similar, senior position at Credit Suisse First Boston.

THE City of Buenos Aires this week launched a Eu100m three year transaction, hurrying to the market ahead of a planned issue for the Province of Buenos Aires that should hit the market next week. The city's 9.5% three year deal priced at 99.45 to yield 9.72%.

Credit Suisse First Boston and Merrill Lynch have at last launched the co-arranger level of the Sfr625m of senior debt backing Morgan Grenfell Private Equity's (MGPE) buy-out of Ciba's polymers business, to be called Vantico. Launching into a European market hungry for leveraged paper, the lead banks are offering underwriting co-arrangers an all-in fee of 120bp to underwrite Sfr75m. The fee is made up of a 45bp underwriting fee and a 75bp participation fee.

* Landsvirkjun Guarantor: City of Reykjavik, Republic of Iceland, Township of Akureyi

Issuance in the US dollar corporate and agency markets continued at a cracking pace this week, with more than $12bn of debt issued by yesterday's (Thursday) close, as further evidence of a slowdown in the US economy boosted investor sentiment. Following record US dollar bond volumes last week of more than $19bn, borrowers such as Lehman Brothers, Freddie Mac and the IADB all issued $1bn or more in global bonds.

The UK government's Private Finance Initiative took a significant leap forward this week as Deutsche Bank placed the largest PFI bond so far to finance construction of a new building for the country's main electronic spying installation, the Government Communications Head-quarters, in Cheltenham. The £406.85m bond was issued by Integrated Accommodation Services plc (IAS), a consortium that has a contract to demolish two buildings, build a new one and service it until 2029.

Deutsche Telekom will this month launch the largest ever financing package for a telecoms company, when it taps the dollar, euro, sterling and yen markets for $8bn equivalent. The jumbo bond issue will be the second largest corporate bond issue ever and provide the toughest test to date of how much telecoms paper the market can absorb.

At current market prices Deutsche Bank and Goldman Sachs could raise as much as Eu490m for semiconductor manufacturer Dialog with a secondary offering of 8.5m shares. Dialog has been listed on the Neuer Markt and Easdaq for about a year, and will use the occasion of this secondary issue to list on Nasdaq. Bookbuilding opened yesterday (Thursday) and will close on June 28. The reference price will be the closing price on June 28, and Dialog will list on Nasdaq on June 29.