Hayes Lemmerz to redeem notes, repay bank debt with stock sale proceeds

New York, Nov. 14 - Hayes Lemmerz International Inc. said it will use proceeds from an offering of common stock to redeem some of its 10½% senior notes due 2010, to repay bank debt and for general corporate purposes.

The Northville, Mich., maker of auto and truck components registered an offering of up to 12.42 million shares of common stock with the Securities and Exchange Commission Friday. Of the total, Hayes Lemmerz will sell 5.45 million shares plus a greenshoe of up to 1.62 million shares while selling stockholders will sell a further 5.35 million.

An offering price of $16.33 was listed in the prospectus, based on the trading levels of the company's stock on the Bulletin Board on Nov. 10. Using that price, the total offering would be for $202.8 million.

Of its share of the proceeds, Hayes Lemmerz will use $25.0 million to redeem $22.6 million of its 10½% notes at 110.5% of their principal amount plus accrued interest.

The company is also required by the terms of its credit facility to use 75% of the remaining proceeds to repay part of its term loan due 2009. The term loan currently has $450 million outstanding. Interest is Libor plus 375 basis points.

Both the term loan and the notes were issued as part of the company's emergence from bankruptcy in June.

Remaining proceeds from the stock sale will be used for general corporate purposes.

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