Suburban Propane wraps early tenders; rest to be called after offer

By Susanna Moon

Chicago, May 28 - Suburban Propane Partners, LP and Suburban Energy Finance Corp. plan to redeem any 7½% senior notes due 2018 that remain outstanding after the end of the tender offer, according to an 8-K filing with the Securities and Exchange Commission and a company press release.

The notes will be redeemed at 103.75% of par plus accrued interest up to but excluding the redemption date of Oct. 1.

Funding for the redemption and the tender offer will come from the issue of $525 million principal amount of 5½% senior notes due 2024, which priced on May 12.

As of 5 p.m. ET on May 23, holders had tendered $385,809,000, or 77.7%, of the $496,557,000 principal amount of 7½% notes in the offer that began on May 12.

The company paid about $413,979,487.29 to settle notes tendered by the consent date, which consisted of $397,904,112.15 for the base payment, $4,501,105.14 for accrued interest and $11,574,270 for consent payments as well as about $119,054,100 to the trustee in connection with the satisfaction and discharge of the remaining 2018 notes, the filing noted.

The issuers received the needed consents from a majority of the outstanding notes and entered into a supplemental indenture to the notes, which eliminate substantially all of the restrictive covenants and some events of default.

The tender offer will continue until 11:59 p.m. ET on June 9.

Tenders and consents may no longer be withdrawn or revoked, as of the early tender deadline.

As previously announced, the total purchase price is $1,061.35 for each $1,000 principal amount of notes tendered by the May 23 consent date. The total amount includes a consent payment of $30.00 per $1,000 principal amount of notes.

Those who tender after the consent date will receive $1,031.35 per $1,000 of notes.

Holders also will receive accrued interest up to but excluding the settlement date.

The final settlement date will be June 10.

As noted before, the offer is conditioned on the company securing the needed consents to amend the notes and the completion of a new senior debt offering.

Wells Fargo Securities, LLC (866 309-6316 and 704 410-4760 collect) is the dealer manager. D.F. King & Co., Inc. (800 549-6697 and 212 269-5550 collect or sph@dfking.com) is the information agent.

Suburban Propane is a Whippany, N.J.-based retail marketer and distributor of propane, fuel oil and refined fuels.

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