Land O'Lakes to hold tender offer for 8¾%, 9% notes

By Angela McDaniels

Seattle, Feb. 21 - Land O'Lakes, Inc. will offer to purchase its 8¾% senior notes due 2011 and 9% senior secured notes due 2010 at par, according to an 8-K report filed with the Securities and Exchange Commission on Wednesday.

The company has agreed to sell the assets of its Cheese & Protein International operations to Saputo Cheese USA Inc. for about $216 million. The indentures governing the notes require Land O'Lakes to apply the proceeds of an asset disposal first to repay bank debt; second, to invest in additional assets; third, to make a par offer for the notes; and fourth, for any general corporate purposes.

The Arden Hills, Minn.-based food and agricultural cooperative said it does not plan to prepay any bank debt or invest in additional assets, so it will make the tender offer for the notes following the close of the Cheese & Protein sale, which is expected to occur in April.

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