Kraton Polymers gets tenders for $249.39 million 6¾% notes due 2019

By Susanna Moon

Chicago, Jan. 5 – Kraton Polymers LLC said investors had tendered $249,394,000 principal amount, or 71.26%, of the $350 million of outstanding 6¾% senior notes due 2019 co-issued with Kraton Polymers Capital Corp.

The tender offer ended at 11:59 p.m. ET on Jan. 5, extended from 11:59 p.m. ET on Dec. 29. The consent payment and withdrawal deadlines coincided with the end of the offer. The tender offer began on Dec. 1.

Kraton will accept the tendered notes for purchase after the closing of its acquisition of Arizona Chemical Holdings Corp., and the related debt financing, which is set for Jan. 7, according to a company news release.

As previously announced, the total purchase price will be $1,025.50 per $1,000 principal amount of notes.

The company also will pay accrued interest up to but excluding the settlement date.

The company said on Dec. 21 that it amended the consent bid, lowering the consent fee to $27.00 per $1,000 of notes and reducing the total purchase price.

As of Dec. 20, investors had tendered $249,386,000 principal amount, or 71.25%, of the 6¾% notes, which remained unchanged since 5 p.m. ET on Dec. 14, the previous consent payment date.

Kraton said on Dec. 15 that it secured the needed majority of consents to amend the notes and that it had executed a supplemental indenture to the notes.

The tender offer and consent solicitation are being made in connection with Kraton’s planned acquisition, as previously noted.

Originally, the total purchase price was set at $1,028.50 for each $1,000 principal amount of notes tendered by the consent payment deadline. The total amount had included a consent payment of $30.00 per $1,000 principal amount.

Holders who tendered their notes after the consent deadline would have received the tender offer payment of $998.50 per $1,000 of notes, before the offer was amended.

The company said it expected to fund the offer using proceeds of a debt financing, along with cash on hand.

The offer is conditioned on completion of the Arizona Chemical acquisition and closing of the related debt financing.

The company began a roadshow on Dec. 7 for a $425 million offering of eight-year senior notes.

Kraton previously said it planned to redeem any notes that remain outstanding on March 1 at 101.688% of par plus accrued interest to the redemption date.

D.F. King & Co., Inc. (212 269-5550, 866 796-7179 or kra@dfking.com) is the information agent. Credit Suisse Securities (USA) LLC (212 538-2147 or 800 820-1653) is the dealer manager and solicitation agent.

Kraton is a Houston-based producer of engineered polymers and styrenic block copolymers. The company is a wholly owned subsidiary of Kraton Performance Polymers, Inc.

Arizona Chemical is a biorefiner of pine chemicals with executive offices in Jacksonville, Fla., and Almere, the Netherlands.

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