Hayes Lemmerz tenders for 10½% notes

By Jennifer Chiou

New York, May 9 - Hayes Lemmerz International Inc. announced that its indirect subsidiary, HLI Operating Co., Inc., began a cash tender offer for all of its $157 million of 10½% senior notes due 2010.

The Northville, Mich., supplier of automotive and commercial highway wheels, brakes and powertrain components is also soliciting consents to amend the indenture to, among other things, eliminate substantially all restrictive covenants, certain related events of default and conditions on the defeasance of the notes, and certain limitations on the ability of HLI and Hayes Lemmerz to merge, consolidate, sell all or substantially all of their assets, and enter into similar transactions.

In addition, the proposed amendments will permit notice of redemption of the notes and the intended redemption to occur on the same day.

The consent deadline is 5 p.m. ET on May 21. The offer ends at 11:59 p.m. ET on June 5.

For each $1,000 principal amount, the company said it will fix its payout using the 3.625% Treasury due June 30, 2007 and a fixed spread of 50 basis points. The payout will include a $30.00 consent payment for those who tender by the early deadline.

The company will also pay accrued interest to, but not including, the payment date.

The offer is conditioned on tenders from holders of a majority of notes, sufficient financing as well as the execution of a supplemental indenture.

HLI said that it will use proceeds from Hayes Lemmerz's previously announced $180 million equity rights offering for the offer.

Deutsche Bank Securities Inc. is the dealer manager and solicitation agent (contact Patricia McGowan at 212 250-7772). Innisfree M&A Inc. is the information agent (call collect 212 750-5833 or 888 750-5834).

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