When Covanta Energy Corp. retained Salomon Smith Barney to explore strategic alternatives the Street clearly hated the news. Of course, the company’s possible divestiture news was coupled by its revelation that it was in violation of debt covenants. And one analyst said that though a sale of Covanta in its entirety could happen, it would be difficult under current market conditions. Indeed, the Dec. 21 news, made after the market closed, rocked Covanta’s, as it fell 60% from its opening price to close at $3.99. At press time, Covanta closed at $5.89. In a statement, the company said delays in the sales of its non-energy aviation and entertainment assets had affected its ability to meet its debt payments. Covanta also said that it was in discussions with its banks regarding debt waivers and a cash infusion.
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