Sparkling Spring to use IPO proceeds to repay notes, bank debt

New York, May 15 - Sparkling Spring Water Holdings, Ltd. said it plans to use proceeds from its initial public offering to repay all its senior subordinated notes and reduce its bank debt.

The Dartmouth, Nova Scotia bottled water delivery company has $74.6 million principal amount of its 11.5% senior subordinated notes due 2007 outstanding and $28.2 million of borrowings on its credit facility, both figures being as of April 30.

Sparkling Spring said it would either redeem the notes in November 2002 or by open market repurchases.

The company's multi-currency credit facility is made up of a $15.0 million operating line renewable annually by April 30, an $8.5 million acquisition facility that matures April 30, 2006, and a $12.0 million term loan that matures October 31, 2005.

If the IPO proceeds are not enough to repay the whole facility, Sparkling Spring said it would repay the acquisition facility and operating line first.

Sparkling Spring filed a $115 million IPO of common shares with the SEC on Wednesday. It named Goldman, Sachs & Co. and UBS Warburg as lead managers with JPMorgan and TD Securities Inc. also included in the syndicate.

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