A proposed $878 million hostile takeover of Telex Corp. ran into trouble yesterday amid growing fears about the market for low-rated, high-yield securities known as junk bonds.

Corporate raider Asher Edelman, who had planned to finance the takeover with junk bond debt, said he was reviewing "all aspects" of his $65-a-share offer for the Tulsa-based computer firm in the wake of the apparent breakdown of a major junk bond-financed buyout of Southland Corp.

Edelman's comments, coming one day after the Southland development, reinforced concerns on Wall Street that the market for new junk bond debt finally may be cooling in light of persistent worries about the future of the economy. That could have widespread repercussions, most immediately for several major investment banking firms that have sought to encourage junk bond transactions by advancing hundreds of millions of dollars in so-called "bridge loans" to prospective customers, some Wall Street professionals noted.

"Everybody who had been expecting to do a takeover or {leveraged buyout} type deal can no longer assume that these things are going to be sold successfully," said Jim Grant, editor of Grant's Interest Rate Observer, and a long-time junk bond critic. "That will necessarily put a chill on any junk bond offering."

Grant and others noted that high-yield securities now are carrying interest rates as high as 18 percent, well above the 12 to 13 percent rate of last spring when they were still selling strong. The fact that investors are wary about buying them now, when yields are so high, is the most telling signal of the fears surrounding junk debt, some analysts said.

"The market isn't there, it isn't taking this junk," said Carol Palmer, an analyst with the Chicago securities rating firm of Duff & Phelps.

Yet, as with the larger debate over the wisdom of junk bond financing, there were contrary views being advanced yesterday by those with the most to lose. Steve Anreder, a spokesman for Drexel Burham Lambert Inc., the firm that pioneered the junk bond market, noted that in the last three weeks alone, U.S. corporations have bought back up to $3 billion of their own junk bond debt -- one sign that the market for high yield securities remains brisk.

"The market has been broadening very significantly," said Anreder. "The point is, if you have decent paper, you can bring out new issues in this market."

The strongest sign of the new chill in the market, according to the critics, was Southland's announcement Tuesday that it could not proceed with a $4.9 billion plan to take the company private. The Dallas-based firm, which owns the 7-Eleven convenience stores, said that its two investment bankers -- Goldman, Sachs and Co. and Salomon Brothers Inc. -- had advised it that "based upon current market conditions" they would be unable to sell up to $1.5 billion in junk securities that were to be issued to finance the deal.

The underlying problem, analysts said, is the fundamental fear about the economy hanging over most American companies. In the event of a serious economic downturn, a prospect that has seemed far more tangible since the Oct. 19 stock market collapse, Southland -- along with hundreds of other firms -- could face insurmountable difficulties in meeting the high interest payments called for by junk bonds.

Those fears have yet to be realized, and there have been no major junk bond defaults to date, several Wall Street analysts said. Moreover, some analysts said that Southland's management, headed by chairman John P. Thompson, still has other avenues they could pursue in consummating the leveraged buyout.

"This is not the end of the world for Southland by any means," said analyst Palmer, who follows the company. She noted that the company had planned to finance a portion of the buyout through the divestiture of a huge chunk of its assets, including about 1,000 of its 7,500 7-Eleven stores. The sale of some of those assets, including 270 stores in the Houston area, has already netted the firm about $132 million -- some $20 million to $30 million more than anticipated.

The more immediate problem, some analysts said, would be faced by Goldman Sachs and Salomon, which were in the process of advancing the Southland management group about $300 million each in bridge loans to tide the group over until the junk bond placement in February. About $200 million -- $100 million by each firm -- has already been advanced.

Officials of both firms did not return phone calls yesterday. But analysts said a complete collapse would probably leave Goldman and Salomon exposed, dealing another blow to companies already hurting as a result of the market collapse.

On the New York Stock Exchange yesterday, Telex closed at $50, down $1, while Southland gained $2.50 to $54.

Staff writer Steve Coll also contributed to this report.