Arch Western to price $250 million add-on to 6¾% notes

By Paul A. Harris

St. Louis, Oct. 18 - Arch Western Finance LLC plans to price a $250 million add-on to its 6¾% senior notes due July 1, 2013 Tuesday, according to a syndicate source.

Official price talk had not been issued as Prospect News went to press Monday night.

Citigroup, JP Morgan and Morgan Stanley will run the books for the Rule 144A add-on.

The notes are callable on July 1, 2008 at 103.375, with the call premium declining annually from that date to 102.250, 101.125 and to par on July 1, 2011 and thereafter. The notes also contain an equity clawback until July 1, 2006 for 35% at 106.75.

Proceeds will be used to repay the company's $100 million term loan due in 2007, with the balance of proceeds to be loaned to Arch Western Resource's parent company, Arch Coal Inc., to repay Arch Coal's revolving credit facility and for general corporate purposes.

Arch Western is a St. Louis-based coal company.

The original $700 million issue priced at par on June 19, 2003.

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