Beam gives early results for 6.375% notes due 2014, four other series

By Toni Weeks

San Luis Obispo, Calif., June 3 - Beam Inc. reported early results for its tender offers for any and all of its 6.375% notes due 2014 and an aggregate of up to $175 million of four other notes series. According to a press release, the company received and accepted the following amounts of notes by 5 p.m. ET on May 31, the early tender date:

• $78,091,000, or 23.92%, of $326,414,000 of 6.375% notes due 2014;

• $2,649,000, or 4.47%, of $59.3 million of 8.625% debentures due 2021;

• $1,602,000, or 1.41%, of $113,792,000, of 7.875% debentures due 2023;

• $15,679,000, or 7.84%, of $200 million of 6.625% debentures due 2028; and

• $137,962,000, or 45.99%, of $300 million of 5.875% notes due 2036.

Pricing for the offer was set at 2 p.m. ET on June 3 using a reference to the bid-side yield of a U.S. Treasury reference security plus a fixed spread. The total consideration per $1,000 principal amount of notes was calculated as follows:

• $1,057.63 for the 6.375% notes, based on the 0.75% Treasury note due June 15, 2014 plus 50 basis points to yield 0.662%;

•$1,378.30 for the 8.625% notes based on the 1.75% Treasury note due May 15, 2023 plus 130 bps to yield 3.421%;

• $1,337.42 for the 7.875% notes based on the 1.75% Treasury note due May 15, 2023 plus 155 bps to yield 3.671%;

• $1,292.51 for the 6.625% notes based on the 1.75% Treasury note due May 15, 2023 plus 190 bps to yield 4.021%; and

• $1,225.68 for the 5.875% notes based on the 3.125% Treasury note due Feb. 15, 2043 plus 105 bps to yield 4.303%.

The latter four series of notes are listed in order of acceptance priority level, with the 8.625% and 7.785% debentures sharing first-priority level.

The total purchase price includes a $30 early tender payment for each $1,000 principal amount of notes tendered by the early tender date. Notes tendered after the early tender date but by the expiration date for the offer, 11:59 p.m. ET on June 14, will not receive the $30 early tender payment.

Tendered notes may no longer be withdrawn.

The company also will pay accrued interest up to but excluding the settlement date of June 10 for early tendered notes and June 17 for remaining tenders.

The company expects to redeem all 6.375% notes that are not tendered by the expiration date, according to the press release.

The tender offers are conditional on Beam receiving net proceeds from a debt financing transaction sufficient to purchase all notes validly tendered and accepted for purchase and to redeem the remaining notes.

The tender offers are part of the company's plans "to refinance a portion of its currently outstanding debt in a favorable interest rate environment," according to a previous press release.

BofA Merrill Lynch (888 292-0070 or collect 646 855-3401) and Credit Suisse (800 820-1653 or collect 212 325-2476) are the dealer managers. D.F. King & Co., Inc. (800 769-4414 or collect 212 269-5550) is the information agent and tender agent.

Beam, formerly Fortune Brands, Inc., produces and sells spirits. The company is based in Deerfield, Ill.

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