Semco Energy gets consents needed for 7 1/8%, 7¾% notes, prices tender offer

By Angela McDaniels

Seattle, Oct. 24 - Semco Energy, Inc. said it received tenders and consents from holders of $145.06 million, or 96.7%, of its 7 1/8% senior notes due 2008 and from holders of $199.86 million, or 99.9%, of its 7¾% senior notes due 2013.

The consents will allow the company to eliminate substantially all of the restrictive covenants and some events of default in the note indentures. The supplemental indentures containing the amendments will become effective once Semco Energy accepts the tendered notes for purchase.

The tender offer ends at 5 p.m. ET on Nov. 7. The consent deadline was 5 p.m. ET on Oct. 23.

For each $1,000 principal amount, the company said it will pay $1,012.59 for the 7 1/8% notes and $1,053.58 for the 7¾% notes.

The payouts include a consent payment of $30.00 for each note tendered by the consent deadline.

Holders will also receive accrued interest up to but excluding the payment date, which is expected to be Nov. 9.

The payouts were determined on Oct. 24 based on a fixed spread of 50 basis points over the yield of the 5 5/8% U.S. Treasury note due May 15, 2008. The reference yield was 4.129%.

The offer remains conditioned on the completion of Semco Energy's pending share exchange with Cap Rock Holding Corp.

Credit Suisse Securities (USA) LLC (800 820-1653 or call collect 212 538-0652) is the dealer manager and solicitation agent. D.F. King & Co., Inc. (800 290-6431 or call collect 212 269-5550) is the information agent.

Semco Energy is a natural gas distributor based in Port Huron, Mich.

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