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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony, -- Ignore unavailable to you. Want to Upgrade?

To: allen menglin chen who wrote (51394)	2/6/2000 12:50:00 AM
From: peter michaelson	Read Replies (1) \| Respond to of 122087

MCLL junk bonds were at $60 before the news hit Thursday. Metrocall Junk Bonds Up 15 Points On Cash Infusion News NEW YORK -- Metrocall Inc.'s (MCLL) junk bonds were sharply higher Thursday morning on news that the company will receive $51 million in capital from three separate investors. The Alexandria, Va-based wireless data and messaging company's outstanding 10 3/8% coupon junk bonds due 2007 were quoted up 15 points at 75 in the secondary market. Common shares of the company were recently trading at 6, up 3 31/32 or nearly 200%, on heavy volume of more than 34 million shares, as investors interpreted the news as votes of confidence in the company. Metrocall announced Thursday it will receive a total of $51 million from PSI Net Inc. (PSIX), investment company Hicks Muse Tate & Furst and a third unnamed technology company. In a press release Thursday, Metrocall said the companies will each buy about 7.8 million common shares and each will own about 9.9% of Metrocall, following the conversion of convertible preferred shares owned by AT&T Corp. (T). Metrocall also announced Thursday it has agreed to acquire AT&T's NationPage for $13 million in cash. As part of that transaction, AT&T will exchange its Series C preferred Metrocall shares, worth about $105 million, for about 13.3 million common shares. Metrocall said proceeds of the investments from the three companies would be used to pay down debt. Each of the three investors will pay $2.19 a share, or $17 million each, according to Metrocall. Metrocall and the three investors, along with other investors, also agreed to establish a joint venture that will offer Internet, wireless and other services to small- and home office customers and middle-market companies. One trader said he thought some high-yield participants might have sold MetroCall bonds short, betting the paging industry is becoming obsolete and prices of the company's bonds would decline. Metrocall's announcement of a cash infusion may have spurred demand for its junk bonds by prompting investors to quickly close out short positions, the trader said. "This took the market by surprise," he said. At least one other paging company's debt traded up following Metrocall's news. Paging Network Inc.'s (PAGE) 10% coupon notes due 2008 traded at 45 Thursday after finishing Wednesday's session quoted at 39 bid. Its shares were recently quoted at 1 19/32, up 3/16 or 13.3% Meanwhile, Arch Communications Group Inc. (APGR) 12.75% notes due 2007 were quoted unchanged Thursday at 79 bid. Its senior discount notes due 2001 were unchanged at 48 bid, 50 offered the trader said. -By John Dooley; Dow Jones Newswires; 201-938-2078; john.dooley@dowjones.com