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Lyondell gets tenders for 97% of 11 1/8% notes
By Angela McDaniels
Seattle, May 16 - Lyondell Chemical Co. said it received tenders for $270 million, or 97%, or its $278 million of 11 1/8% senior secured notes due 2012 during a tender offer that expired on May 15.
The number of notes tendered is unchanged from May 2, when the company announced it had received enough consents to amend the indenture to eliminate substantially all the restrictive covenants.
Lyondell also received consents to amend a restrictive provision in the indenture of its $325 million of 10½% senior secured notes due 2013 that requires the company to refinance debt that is subordinated in right of payment to the notes by issuing new subordinated debt.
Supplemental indentures have been executed for both series of notes, according to a company news release.
For each $1,000 principal amount of 11 1/8% notes tendered, noteholders will receive $1,066.11 plus accrued interest up to but excluding the payment date.
The tender consideration includes a consent fee of $30.00 per $1,000 principal amount of notes tendered by May 1, the consent deadline.
Pricing was determined on May 1 using the present value of $1,055.63 - the redemption value of the notes on their first call date of July 15, 2007 - plus the amount of interest that would accrue to the call date minus accrued interest from the last payment date. The discount rate was a fixed spread of 50 basis points over the yield on the 3 5/8% Treasury due June 30, 2007. The reference yield was 4.918%, and the tender offer yield was 5.418%.
The Houston-based chemical company said it intends to fund the repurchase with cash on hand and borrowings under its revolving credit facility.
The tender offer began on April 18.
Citi (800 558-3745 or call collect 212 723-6106) was the solicitation agent and dealer manager, and D.F. King & Co., Inc. (800 735-3107 or call collect 212 269-5550) was the information agent.
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