Aliant Telecom sets pricing in redemption of debentures, first-mortgage bonds

New York, June 5 - Aliant Telecom Inc. announced pricing for the redemption of its 8.3% series 2 debentures, 9.7% series 4 debentures, 9.05% series 5 debentures, 10¾% first mortgage series T bonds, 10.60% first mortgage series T bonds, 11.15% first-mortgage series U bonds, 9.77% first mortgage series V bonds and 8.76% first mortgage series W bonds.

For the 8.3% debentures, the price is C$1,383.11 per C$1,000 principal amount, for the 9.70% debentures C$1,521.25 per C$1,000 principal amount, for the 9.05% debentures C$1,559.69 per C$1,000 principal amount, for the 10¾% first mortgage bonds C$1,402.13 per C$1,000 principal amount, for the 10.60% first mortgage bonds C$1,215.97 per C$1,000 principal amount, for the 11.15% first mortgage bonds C$1,253.24 per C$1,000 principal amount, for the 9.77% first mortgage bonds C$1,464.70 per C$1,000 principal amount, for the 8.76% first mortgage bonds C$ 1,400.96 per C$1,000 principal amount.

Aliant announced the redemption on May 31 and said the securities will be redeemed at a price based on the Canada yield price - the yield to maturity of the comparable maturity Government of Canada bond calculated on the business day preceding board approval of the redemption - plus 25 basis points for the 8.3% debentures, 20 bps for the 9.7% debentures, 20 bps for the 9.05% debentures and 50 bps for the first-mortgage bonds.

The company will also pay accrued interest to the redemption date, which will be the later of June 30 or the second business day after the date on which all redemption conditions are satisfied for the 8.3% debentures, 9.7% debentures, 9.05% debentures, 10¾% first mortgage bonds and July 3 for the rest.

The redemption is subject to management approval, the receipt by Aliant Inc. and BCE Inc. of an advance income tax ruling from the Canada Revenue Agency regarding the tax treatment of certain aspects of the arrangement as well as regulatory approvals.

Aliant added that if the debentures have not been redeemed by Aug. 29 because of unmet conditions, the redemption notice will expire.

On March 7, Aliant and BCE announced the creation of a new income trust.

Based in Saint John, N.B., Aliant provides communications services.

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