FYI.

Tuesday June 26 6:32 PM ET 
Sources: Edison Reworking Bond Sale
By Jonathan Stempel 
NEW YORK (Reuters) - Edison International(NYSE:EIX <http://finance.yahoo.com/q?s=eix&d=t> - news <http://biz.yahoo.com/n/e/eix.html>), in a last-ditch bid to stay solvent, is restructuring a $1.2 billion junk bond sale because investors are afraid of getting caught in a second big California utility bankruptcy, bond market analysts and investors said on Tuesday. 
Edison, the parent of cash-strapped utility Southern California Edison (news <http://rd.yahoo.com/DailyNews/manual/*http://search.news.yahoo.com/search/news?p=%22Southern%0ACalifornia%20Edison%22&c=&n=20&yn=c&c=news&cs=nw> - web sites <http://rd.yahoo.com/DailyNews/manual/*http://search.yahoo.com/bin/search?p=Southern%20California%20Edison&cs=nw>), is considering trimming its bond sale and adding a bank term loan, the analysts and investors said. 
Rosemead, California-based Edison needs cash this week as it struggles with California's power crisis, analysts said. The company is trying to rid itself of debt maturing this year, including a fully drawn down $618 million bank credit line expiring Saturday. 
The seven-year secured notes being sold by Mission Energy Holding Co. have not found enough buyers despite carrying yields as high as 13.5 percent, analysts said. That's more than four percentage points above the recent 9.33 percent yield on a typical junk-rated electric utility bond, according to Merrill Lynch & Co. 
``We were hearing it was significantly undersubscribed around midday when the deal was scheduled to price, so the assumption is it will resurface in another form, probably much cheaper and restructured,'' said John Atkins, a corporate bond analyst at IDEAglobal.com <http://IDEAglobal.com>, a New York-based research firm. 
In the utility's semi-weekly conference call with holders of defaulted SoCal Edison debt, Chief Financial Officer Jim Scilacci said Tuesday afternoon there is ``virtually nothing the company can say'' about the private bond sale. 
Goldman Sachs & Co., which sources said is arranging the bond sale, also declined to comment. 
Edison said earlier this month it intended to use bond sale proceeds to pay down the bank credit line, as well as $250 million of notes due July 18 and $350 million due Nov. 1. 
Mission Energy Holding, which Edison created specifically to raise cash, was designed to be shielded from any bankruptcy of SoCal Edison, Edison or Edison Mission Energy. Some investors have said they are concerned the shield may not prove strong enough. 
Moody's Investors Service rated Mission Energy Holding's notes ``Ba2,'' its second highest junk grade. Standard & Poor's, rated them ``BB-minus,'' one notch lower. 
SoCal Edison, which has defaulted on $931 million of bonds and commercial paper, ran up more than $5.4 billion of debt because California's utility deregulation blocked it from recouping its soaring wholesale power costs. It agreed in April with Gov. Gray Davis (news <http://rd.yahoo.com/DailyNews/manual/*http://search.news.yahoo.com/search/news?p=%22Gov.%20Gray%20Davis%22&c=&n=20&yn=c&c=news&cs=nw> - web sites <http://rd.yahoo.com/DailyNews/manual/*http://search.yahoo.com/bin/search?p=Gov.%20Gray%20Davis&cs=nw>) on a rescue plan, but regulators have been slow to implement it, and many legislators oppose it. 
The utility is California's second largest; the largest, Pacific Gas & Electric Co., a unit of San Francisco-based PG&E Corp.(NYSE:PCG <http://finance.yahoo.com/q?s=pcg&d=t> - news <http://biz.yahoo.com/n/p/pcg.html>), filed for bankruptcy protection on April 6. 
Shares of Edison closed Tuesday on the New York Stock Exchange (news <http://rd.yahoo.com/DailyNews/manual/*http://search.news.yahoo.com/search/news?p=%22New%20York%20Stock%0AExchange%22&c=&n=20&yn=c&c=news&cs=nw> - web sites <http://rd.yahoo.com/DailyNews/manual/*http://search.yahoo.com/bin/search?p=York%20Stock%20Exchange>) at $11.24, down 33 cents. They have fallen 28 percent this year.