Advanta prolongs tender offer for 8.99% capital securities to June 15

By Jennifer Chiou

New York, June 9 - Advanta Corp. announced the extension of the tender offer for Advanta Capital Trust I's $100 million of 8.99% capital securities.

The offer will now expire at 5 p.m. ET on June 15, prolonged from June 10. The extension was prompted by information that Advanta disclosed in a Monday 8-K filing. In that announcement, the company said it was abandoning its tender offer for up to $1.4 billion of Advanta Business Card Master Trust's class A senior notes because it found that a regulatory condition to the offer would not be satisfied.

As a result of ending that offer, the company said it will not be able to complete all components of the plan intended to limit credit loss exposure and maximize capital and liquidity measures.

As of 5 p.m. ET on June 8, holders of about $7 million of Advanta Capital Trust's securities had tendered.

As announced at the start on May 11, the offer is part of the company's credit and liquidity plan.

Holders who tender will receive 20% of par.

Advanta previously said that because of the deteriorating economic environment, it expects its negative performance trends to result in losses that will erode its capital unless it executes the plan.

The company will be free to do new business in the future but does not expect to do so in a significant way until the plan is well under way, according to a prior release.

The dealer manager for the tender offer is Sandler, O'Neill + Partners, LP (contact Katherine Orr at 866 805-4128 or 212 466-8038), and the information agent is Global Bondholder Services Corp. (866 470-4200).

Spring House, Pa.-based Advanta provides credit cards to small business through Advanta Bank Corp.

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