Hanger Orthopedic Group to redeem all 10% preferreds, to refinance 10 3/8% notes, 11¼% notes

By Jennifer Chiou

New York, May 4 - Hanger Orthopedic Group, Inc. announced it will redeem its10 3/8% senior notes due 2009, 11¼% senior subordinated notes due 2009 and 10% redeemable preferred stock as part of its refinancing plan.

The Bethesda, Md., provider of orthotic and prosthetic patient care services said it will use the proceeds from a $50 million private placement of 3.33% convertible perpetual preferred stock, a new senior secured credit facility comprised of a $230 million term loan and a $75 million revolving credit facility and a private offering of up to $190 million of senior unsecured notes for the refinancing plan.

Hanger noted that about $65 million will be used to redeem the preferreds, $166 million to repay indebtedness outstanding as of March 31 under its existing revolving credit and term loan facilities, $200 million to refinance its 10 3/8% notes and $16 million to refinance its 11¼% notes.

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