KinderCare files to sell $625 million IDS, notes; to tender for 9½% notes, amend loan

New York, April 21 - KinderCare Learning Centers Inc. filed an offering of up to $625 million of Income Deposit Securities and senior subordinated notes due 2014 with the Securities and Exchange Commission Wednesday as part of a recapitalization.

The IDS will be made up of class A common stock and notes identical to those that will be issued separately. After 45 days they can be separated into their components.

CIBC World Markets was named as bookrunner for the offering.

As part of the transaction, the Portland, Ore., operator of child care centers will offer its existing equity investors - KKR-KLC LLC, an affiliate of Kohlberg Kravis Roberts & Co. LP, and Oaktree Capital Management LLC, an affiliate of The TCW Group Inc. - cash and IDS or class B common stock. If the over-allotment option for the public sale is exercised the equity investors will receive cash instead of IDS.

KinderCare will also amend its revolving credit facility. The current facility is a $125 million revolver due 2008.

In addition, KinderCare will launch a tender offer and consent solicitation for its $179.4 million outstanding 9½% senior subordinated notes due 2009. Funding for the tender offer will come from the sale of IDS and new notes.

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