Graham Packaging postpones $100 million add-on, cites stock market conditions

By Paul A. Harris and Sara Rosenberg

St. Louis, Mo., July 23--Graham Packaging Co. LP/GPC Capital Corp. I cited stock market conditions as it postponed its planned $100 million add-on to its 8¾% senior subordinated notes due Jan. 15, 2008, on Tuesday.

The company had been planning the debt deal as part of a recapitalization linked to an initial public offering of common stock.

But Graham Packaging said Tuesday that it was postponing the IPO due to the "recent adverse conditions in the stock market."

Based on advice from the company's equity owners and underwriters, the $250 million IPO is postponed until market conditions improve, Graham Packaging said.

As well as postponing its bond offering, the company also delayed the remainder of its recapitalization plan, including a $550 million term loan, a $150 million revolver and a tender offer and consent solicitation for $169 million principal amount at maturity of its existing senior discount notes.

Deutsche Bank Securities Inc. and Salomon Smith Barney were joint bookrunners for the bond offering. Goldman Sachs & Co., Lehman Brothers, Morgan Stanley and ABN Amro were the co-managers.

The company intended to use the proceeds to repurchase its $169 million principal amount ($155.7 million accreted value) senior discount notes and repay bank debt.

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