HudBay Minerals wraps defeasance for remaining $2.9 million of 9 5/8% notes

By Laura Lutz

Washington, Feb. 22 - HudBay Minerals Inc. subsidiary Hudson Bay Mining and Smelting Co., Ltd. completed the covenant defeasance of its $2.9 million outstanding principal amount of 9 5/8% senior secured notes due 2012.

The company deposited in trust $3.3 million of U.S. government securities. That amount is sufficient to pay the principal amount of the 9 5/8% notes as well as interest and the redemption premium to the redemption date of Jan. 15, 2009.

Under the terms of the note indenture, the collateral securing the notes will be released.

In December, the company completed a tender offer for the 9 5/8% notes, accepting tenders for most of the notes then outstanding.

"We have repurchased the notes in the open market and through our successful tender offer using free cash flow and now with the defeasance complete, we are positioned to advance our growth strategies both organically and through the evaluation and pursuit of M & A opportunities," Peter Jones, HudBay president and chief executive officer, said in a news release.

HudBay is a mining company based in Winnipeg, Manitoba.

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