By Lisa Kerner
Charlotte, N.C., Sept. 23 - Encore Capital Group Inc. provided additional details of its previously announced private placement of $50 million of seven-year 7.75% senior secured notes in a form 8-K filing with the Securities and Exchange Commission.
Proceeds were used to reduce total outstanding borrowings under Encore's existing revolving credit facility, including borrowings incurred to repay the remaining $42.9 million of 3.375% convertible senior notes that matured on Monday.
The effective interest rate on the liability component of the 3.375% convertibles was 10.38%.
Interest on the notes is payable quarterly, the filing said.
A principal amount of $2.5 million will be payable on March 17, June 17, Sept. 17 and Dec. 17 of each year from Dec. 17, 2012 through June 17, 2017.
The notes are guaranteed in full by some Encore subsidiaries and a pledge of their assets.
Encore may prepay at any time all, or from time to time any part of, the notes, in an amount not less than $5 million in the case of partial prepayment, at par plus a make-whole amount determined using Treasuries plus 50 basis points.
Purchasers included Prudential Insurance Co. of America, Pruco Life Insurance Co., Prudential Retirement Insurance and Annuity Co. and Prudential Annuities Life Assurance Corp.
Encore, a San Diego-based distressed consumer debt management company, said it also amended its revolving credit facility, allowing it to issue up to $25 million of additional notes to Prudential Capital under equivalent terms as the senior secured note agreement.
| Issuer: | Encore Capital Group Inc.
|
| Issue: | Senior secured notes
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| Amount: | $50 million
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| Maturity: | Sept. 17, 2017
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| Coupon: | 7.75%, payable quarterly
|
| Price: | Par
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| Make-whole call: | At Treasuries plus 50 bps
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| Settlement date: | Sept. 20
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| Purchasers: | Prudential Insurance Co. of America, Pruco Life Insurance Co., Prudential Retirement Insurance and Annuity Co., Prudential Annuities Life Assurance Corp.
|
| Distribution: | Private placement
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