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Synagro tenders for 9½% notes
New York, May 25 - Synagro Technologies, Inc. said it has begun a cash tender offer and consent solicitation for its $150 million of 9½% senior subordinated notes due 2009.
For each $1,000 principal amount of notes, Synagro will pay the present value on the initial payment date of the $1,047.50 redemption price on the first call date of April 1, 2006 plus the present value of the interest from the last interest payment date to the first call date, discounted using a spread of 50 basis points over the yield of the 1½% U.S. Treasury note due March 31, 2006, minus accrued interest from the last interest payment date up to but excluding the payment date.
The price includes a $30.00 per $1,000 consent payment that will only be paid to holders who tender by the consent deadline of 5 p.m. ET on June 9.
Pricing will be fixed at 2 p.m. ET at least 10 business days before the expiration. Synagro said it expects the date will be June 15. Initial payment is expected on June 20.
The consent solicitation is to amend the note indenture to eliminate substantially all of the restrictive covenants and certain events of default. Synagro needs consents from holders of at least a majority of the notes.
Holders may not tender without delivering consents and vice versa.
The tender ends at 5 p.m. ET on June 29.
Banc of America Securities LLC (contact High Yield Special Products collect at 704 388-9217 or 888 292-0070) and Lehman Brothers Inc. (contact Liability Management Group collect at 212 528-7581 or 800 438-3242) are dealer managers and solicitation agents. D. F. King & Co., Inc. is the information agent (call collect 212 269-5550 or 800 659-5550).
Synagro is a Houston-based recycler of biosolids and other organic residuals.
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