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Southern Natural Gas accepts tenders for $66 million of 6 1/8% notes
By Jennifer Chiou
New York, Dec. 28 - Southern Natural Gas Co. said it accepted tenders from holders of $66.02 million of its 6 1/8% notes due Sept. 15, 2008.
The offer ended at midnight ET on Dec. 27.
The company paid $1,016.16 for each $1,000 principal amount of notes tendered by 5 p.m. ET on Dec. 12.
The payout included an early tender premium of $30.00 per $1,000 principal amount. Notes tendered after the early tender deadline but before the offer expiration received $986.16 per note.
All noteholders who tendered also received accrued interest up to but excluding the settlement date, which was Dec. 13 for notes tendered by the early tender deadline and Dec. 28 for notes tendered after that.
The company said that as of the early tender deadline, it had received tenders for $66.01 million of the $100 million outstanding principal amount of notes.
The payout was determined at 2 p.m. ET on Dec. 12 based on a fixed spread of 75 basis points over the bid-side yield of the 3 5/8% Treasury note due Oct. 31, 2009.
In a previous news release, Southern Natural Gas said the tender offer was the first step in its plan to reduce its outstanding debt by about $289 million.
Merrill Lynch & Co. (888 654-8637 or 212 449-4914) and JPMorgan (866 834-4666 or 212 834-4802) were the dealer managers. Global Bondholder Services Corp. (866 952-2200 or 212 430-3774) was the depositary and information agent.
The Delaware company is involved in natural gas transportation and storage and liquid natural gas terminalling operations. It is a subsidiary of El Paso Corp., which provides natural gas and related energy products and is based in Houston.
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