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Iron Age says all notes tendered in exchange
New York, Dec. 2 - Iron Age Corp. said holders tendered all of its 9 7/8% senior subordinated notes due 2008 and all the 12 1/8% senior discount notes due 2009 issued by its parent company Iron Age Holdings Corp. in the company's exchange offer.
In return for the notes, holders of Iron Age Corp.'s notes will receive 95% of the stock of IAC Holdings, a new holding company, and $8 million principal amount of 15% pay-in-kind subordinated convertible secured notes due 2008. IAC Holdings will own all of Iron Age Corp.'s common stock.
Holders of the 12 1/8% notes will receive 5% of the stock of IAC Holdings, subject to 50% dilution on conversion of the new convertibles.
"Iron Age's financial structure has been significantly strengthened with the extinguishment of more than $90.0 million in debt obligations. Further, annual debt service costs will be reduced by nearly $9.0 million," said Bart Huchel, Iron Age's chief financial officer, in a news release.
Following completion of the exchange, Iron Age will be majority owned by two private investment groups: Equity Group Investments LLC, a Chicago based investment firm headed by financier Sam Zell, and entities managed by GSC partners, an investment fund group based in Florham Park, N.J.
Iron Age is a Pittsburgh-based specialty distributor of work and safety footwear.
The exchange, which expired on Nov. 25, had been conditional on a number of conditions including the tender of 100% of the outstanding 12 1/8% notes and at least 99% of the outstanding 9 7/8% notes and the amendment and restatement of the company's senior credit agreement.
Before the offer was announced on Oct. 28, Iron Age agreed to the restructuring in principle with holders of a majority of the principal amount of the company's notes.
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