CONSECO, INC. (CNC) (B2/B) said Monday (March 18) that it had begun an exchange offer to extend the maturities on $2.54 billion of its bonds by one to two-and-half years. The offer - which is open only to qualified institutional investors and those outside of the U.S., - will run through midnight ET on April 12, subject to possible extension. Eligible bondholders are being offered six series of new securities at a rate of $1,000 principal amount of new notes for $1,000 principal of the existing notes. The new notes will have the same coupon and same principal amount as the existing bonds, but maturity dates that have been extended by one to two-and-a-half years, depending upon the issue. Conseco is offering new 8.5% guaranteed senior notes due October, 2003 for its $302.299 million of existing 8.5% senior notes due in October, 2002; new 6.4% guaranteed senior notes due February, 2004 for its $250 million of existing 6.4% senior notes due in February 2003; new 8.75% guaranteed senior notes due August, 2006 for its $788 million of existing 8.75% senior notes due in February, 2004; new 6.8% guaranteed senior notes due June, 2007 for its $250 million of existing 6.8% senior notes due in June 2005; new 9% guaranteed senior notes due April, 2008 for its $550 million of existing 9% senior notes due in October, 2006; and new 10.75% guaranteed senior notes due June, 2009 for its $400 million of existing 10.75% senior notes due in June, 2008. The new notes will be guaranteed on a senior subordinated basis by CIHC, Inc., the holding company for Conseco's principal operating subsidiaries, including its insurance and finance units, and as a result, the new notes will be structurally senior to the existing notes in the company's capital structure. Conseco said it is making the exchange offer in an effort to improve its financial flexibility and enhance its future ability to refinance public debt. The exchange offer is subject to consents from Conseco's bank lenders. AS PREVIOUSLY ANNOUNCED, Conseco, a Carmel, Ind.-based insurance and financial services concern, embarked upon an aggressive debt-reduction program following a major management change in the spring of 2000. As part of that effort, it began buying back portions of the $864 million of public debt maturing in 2002 ($450 issued by Conseco Inc. and $414 million issued by its CONSECO FINANCE CORP. subsidiary, as of June 30, 2001) in several transactions last year. It said on Oct. 30 that it had bought back $49 million of its public debt in the quarter ended Sept. 30, and another $75 million of debt during October ($124 million total). Conseco at the time did not elaborate as to whether those figures represented face amounts of repurchased debt, as turned out to be the case, or total figures it had spent to buy back more than face amount at a discount, nor did it specify which of its public debt issues it had repurchased. Conseco further reported on Dec. 6 that during the month of November, it had repurchased an additional $108 million of public debt scheduled to mature in 2002. The company said that $83 million of the newly repurchased debt had been issued by parent Conseco, Inc., while $25 million had been issued by Conseco Finance. Those repurchases, combined with the previously announced purchases of 2002 maturity debt, brought the total amount bought back in the third quarter ended Sept. 30 and the following two months to $232 million ($148 million from Conseco Inc. and $84 million from Conseco Finance), representing 27% of the two companies' debt which is to mature in 2002 and leaving outstanding at that time $632 million ($302 million from Conseco Inc. and $330 million from Conseco Finance). On Jan. 16, Conseco said that it had repurchased an additional $34 million of public debt maturing in 2002 since its last previous debt repurchase report to investors on Dec. 6, bringing the total amount of 2002 maturities retired early since June 30, 2001 to $266 million, consisting of $148 million for Conseco, Inc. and $118 million for Conseco Finance. All of the most recently retired debt had been issued by Conseco Finance. The total amount retired by the Jan. 16 announcement represented 30% of all Conseco and Conseco Finance public debt due in 2002. The company confirmed that these transactions all occurred at a discount to face value, but it did not disclose the average discount. According to the figures released by Conseco, a total of $598 million of Conseco Inc. and Conseco Finance public debt scheduled to mature in 2002 remained outstanding following the latest transactions, consisting of $302 million of Conseco, Inc. public debt in a single issue that matures in October, and $296 million of Conseco Finance public debt, approximately $125 million of which matures in June, with the balance (about $167 million) maturing in September and $4 million maturing next April. On Jan. 31, Conseco said that Conseco Finance had begun a tender offer for all of its $110.5 million of outstanding 10¼% notes. It said the outstanding principal amount did not include $23.7 million of the notes held by Conseco. The tender offer was scheduled to expire at 5 p.m. ET on March 1; the notes being tendered for would be purchased at par plus accrued and unpaid interest up to, but not including, the payment date. Conseco said Conseco Finance planned to finance the tender offer with working capital, cash flow from operations and available credit facilities. Conseco said March 4 that holders of $75.775 million of the Conseco Finance 10¼% senior subordinated notes coming due on June 1 (not including the $23.7 million of the notes currently held by parent Conseco) had tendered their notes in response to the company's previously announced tender offer, which expired as scheduled without extension on March 1. Conseco said the holders would be paid on March 5 under terms previously announced. It further said that following the tender offer, approximately $34.8 million of the notes would remain outstanding. The dealer manager for the tender offer was Lehman Brothers (call 212 528-7581 or toll-free at 800 438-3242). Georgeson Shareholder Communications, Inc. (call 800 223-2064) was the information agent. Additionally, Conseco said on Feb. 21, that it had decided to tender early for all of the remaining outstanding public debt of Conseco Finance not covered by the previously announced tender offer for the 10¼% notes. Conseco said in its fourth-quarter earnings release that it would tender at par for the $167 million of outstanding Conseco Finance 6.5% notes that are scheduled to mature on Sept. 26, and the $4 million of outstanding Conseco Finance 6.52% notes due 2003. Conseco set a tender date of April 12 for those notes, subject to possible extension, and said that this would give the noteholders the opportunity to to review the audited financial statements in the 2001 10-K forms to be filed with the Securities and Exchange Commission by both parent Conseco and Conseco Finance. It estimated that the audits would be completed in March, and the 10-Ks filed on or about April 1.

McDERMOTT INTERNATIONAL, INC. (MDR) (Ba3) said on Monday (March 18) that its McDERMOTT INC. unit repaid the remaining $196.1 million of its 9 3/8% notes, along with $9.2 million of interest, when they matured on March 15. McDermott, a New Orleans-based energy services company, said it had previously repurchased $28.9 million principal amount of the notes in open market transactions. McDermott Inc. obtained funds to pay off the debt from its exercise of an inter-company put/call agreement with McDermott International, which raised $243 million of cash (before tax of $85.4 million).

CEMEX SA de CV (CX) (Ba1) said Monday (March 18) that it had begun cash tender offers for its US$300 million of outstanding 12¾% notes due 2006 and the US$250 million outstanding liquidation amount of 9.66% putable capital securities issued by its CEMEX INTERNATIONAL CAPITAL LLC unit, as well as related solicitations of consent to amend the indentures of the notes and securities. Cemex, a Monterrey, Mexico-based cement maker (third largest in the world) said the tender offers would expire at 12 noon ET on April 17, subject to possible extension. Cemex is offering the holders of the 12¾% notes US$1,255.00 per US$1,000 principal amount of the notes, an amount consisting of US$1,247.50 for the tender and a consent fee (for holders tendering their notes before the consent deadline) of US$7.50, and is offering holders of the 9.66% securities US$1,112.50 per US$1,000 liquidation amount of the capital securities, an amount made up of US$1,105.00 for the tender and a US$7.50 consent fee. The consent solicitations will expire 12 noon ET on April 3, subject to possible extension. Holders may not consent without also tendering their notes or capital securities. Holders who tender their notes after the consent deadline will receive the tender price but not the consent fee. Cemex said the tender for each security is dependent on the company getting agreement to the proposed indenture changes from the holders of a majority of the principal amount of the respective outstanding security, although neither offer is dependent on the completion of the other. The offers are also conditioned upon the receipt by CEMEX of net proceeds from one or more financing activities (including the sale of one or more series of debt securities) in an amount equal to at least the aggregate principal amount of the notes and the aggregate liquidation amount of the capital securities. J.P. Morgan Securities Inc. and Salomon Smith Barney Inc. are dealer managers for the tender; D.F. King & Co. (call 800 431-9642) is the information agent.

COLT TELECOM GROUP PLC (COLT) (B1/B+) said Monday (March 18) that it had bought back a further £9 million of its bonds for £5 million of cash, continuing the company's recent purchases of its debt. In the latest series of transactions, Colt said that it had bought back US$2 million accreted principal amount of its originally issued US$314 million of 12% senior discount notes due December 2006, bringing the total amount repurchased so far to $32.5 million. It bought back €8.5 million face amount of its originally issued €320 million of 7 5/8% senior notes due December 2009, bringing the total amount repurchased so far to €27.3 million, and bought back €3.2 million accreted principal amount of its originally issued €295 million 2% senior convertible notes due March 2006, bringing the total amount repurchased so far to €84.8 million. Colt also said that although no further bonds were bought in the latest transactions, it has so far bought back £3 million face amount of its originally issued £50 million of 10 1/8% senior notes due November 2007, €4 million face amount of its originally issued €76.7 million 8 7/8% senior notes due November 2007, €31.1 million face amount of its originally issued €306.8 million 7 5/8% senior notes due July 2008, € 68.6 million accreted principal amount of its originally issued €402.5 million 2% senior convertible notes due April 2007, €14 million accreted principal amount of its originally issued €306.8 million 2% senior convertible notes due August 2005, and €62.2 million accreted principal amount of its originally issued €368 million 2% senior convertible notes due December 2006. Colt also said that it may buy additional bonds in the future. AS PREVIOUSLY ANNOUNCED, Colt, a London-based provider of business and telecommunications services in Europe, said on Feb. 28 that it had purchased dollar-, sterling- and euro-denominated bonds with a total face value or accreted amount of £34 million, for a cash outlay of £13 million. Colt said the purchases were made through its Colt Telecom Finance Limited subsidiary, which said it has no intention to sell the notes it has purchased and added that arrangements may be made in due course to cancel such notes. The company gave a detailed breakdown of the purchases, indicating that it had purchased US$2.5 million accreted principal amount of its dollar-denominated 12% notes, bringing to US$22 million its total repurchases of such bonds up to that point. It purchased £500,000 face amount of its sterling-denominated 10 1/8% notes, the only such bonds purchased up to that point. Among euro-denominated securities, it bought €8.7 million face amount of its 7 5/8% senior notes due July 2008, bringing the amount repurchased to €22.2 million; it bought €6 million face amount of its 7 5/8% senior notes due December 2009, bringing to €17 million the face amount of the bonds repurchased; it bought €5.3 million accreted principal amount of its 2% senior convertible notes due March 2006, bringing the accreted principal amount repurchased to €79.5 million; it bought €21.3 million accreted principal amount of its 2% senior convertible notes due December 2006, bringing the amount bought back to €62.2 million; and it bought €10.7 million accreted principal amount of its 2% senior convertible notes due April 2007, bringing the amount purchased to €63.2 million. On March 4, Colt said it had made further purchases of £5.9 million (total face value or accreted amount) of outstanding dollar- and euro-denominated bonds, for a cash outlay of £2.2 million. In the March 4 transaction, Colt purchased $1 million accreted principal amount of its dollar-denominated 12% notes, bringing to $23 million its total repurchases of such bonds up to that point. Among euro-denominated securities, it bought € 2.2 million face amount of its 7 5/8% senior notes due July 2008, bringing the amount repurchased to €24.4 million; it bought €0.9 million face amount of its 8 7/8% senior notes due November, 2007 (original issue amount €76.7 million), bringing the amount repurchased to €4 million; and it bought €5.4 million accreted principal amount of its 2% senior convertible notes due April 2007, bringing the amount purchased to €68.6 million. Colt further said that although it had not repurchased any such notes in the March 4 transaction, it had so far bought back from the following series of bonds: £500,000 face amount of its sterling-denominated 10 1/8% notes; €17 million face amount of its 7 5/8% senior notes due December 2009; €14 million accreted principal amount of its 2% senior convertible notes due August 2005; €79.5 million accreted principal amount of its 2% senior convertible notes due March 2006; and €62.2 million accreted principal amount of its 2% senior convertible notes due December 2006. Colt said on March 8 that it had purchased more dollar-, sterling- and euro-denominated bonds with a total face value or accreted amount of £14 million, for a cash outlay of £8 million. Colt said it had purchased $7.5 million accreted principal amount of its 12% senior discount notes due December 2006, bringing to $30.5 million its total repurchases of such bonds to date. It purchased £2.5 million face amount of its 10 1/8% senior notes due November 2007, bringing repurchases of the issue to £3 million so far. It bought €6.7 million face amount of its 7 5/8% senior notes due July 2008, bringing the amount repurchased so far to €31.1 million; it bought €.8 million face amount of its 7 5/8% senior notes due December 2009, bringing to €18.8 million the face amount of the bonds repurchased so far; and it bought €2.1 million accreted principal amount of its 2% senior convertible notes due March 2006, bringing the accreted principal amount repurchased so far to €81.6 million. Colt also said that although it made no further repurchases in the latest transactions, at this time, it had so far as of that date also bought back €4 million face amount of its 8 7/8% senior notes due November 2007; €68.6 million accreted principal amount of its 2% senior convertible notes due December 2006; €14 million accreted principal amount of its 2% senior convertible notes due August 2005; and €62.2 million accreted principal amount of its 2% senior convertible notes due December 2006. Colt said at that time it might repurchase additional bonds in the future.

POLYMER GROUP, INC.(PGI) (Ca) said on March 15 that it would undertake a series of financial restructuring transactions, including an exchange offer for its outstanding 9% senior subordinated notes due 2007 and its 8.75% senior subordinated notes due 2008. Polymer Group, a North Charleston, S.C.-based producer of non-woven textiles, said the offer will run through April 15, subject to possible extension. The company said the $394.4 million of senior subordinated notes currently held by CSFB Global Opportunities Partners, LP, comprising 67% of the outstanding amount - will be exchanged for equity in the restructured PGI. The remaining notes will be subject to an exchange offer for new notes due 2008.Polymer Group is offering the holders of the remaining one-third of the outstanding notes the choice of either new 8 ½% senior subordinated notes due 2008 at the rate of $300 principal amount per $1,000 principal amount of the existing notes, OR new 9¾% senior subordinated discount notes due 2008 at the rate of $375 principal amount per $1,000 principal amount of the existing notes. At maturity the discount notes will have a principal amount of $678. There will be no separate payment for accrued interest. The exchange offer for the notes is conditional on 95% of the notes not held by CSFB Global Opportunities Partners being tendered. Concurrently with the exchange, Polymer Group is running a consent solicitation to amend the note indentures so that it does not have to make payments of accrued but unpaid interest on any of the existing notes not tendered. If the restructuring is successfully completed, CSFB Global Opportunities Partners - which in addition to converting its bond holdings into equity will also make a $50 million cash investment to reduce senior debt and provide a $25 million letter of credit to support amortizations of bank debt - will end up owning 87.5% of the company's equity, while existing shareholders will own 12.5%, all following a planned one-for-10 reverse stock split. Overall, the company said the transactions will cut its debt by $550 million. PGI also said it has been talking to its senior secured lenders and believes it will be able to amend its credit facility although it has not yet received a final commitment.

SILVERLEAF RESORTS, INC. (SVLF) (C) said Friday (March 15) that it had begun an exchange offer for all its outstanding $66.7 million of 10½% senior subordinated notes due 2008, as part of a debt restructuring plan. Silverleaf, a Dallas-based timeshare resort company, said in a filing with the Securities and Exchange Commission that the exchange offer would run until 5 p.m. ET on April 12. It is offering noteholders a total of $33.35 million of new senior subordinated notes due 2007, 23,937,489 shares of common stock and a cash payment, as well as accrued interest since Oct. 1, 2001. The cash payment will be set equal to the amount of interest on 20% of the existing notes that Silverleaf would have had to pay to cure its current default on the existing notes, less the amount that it actually pays to holders who do not exchange their notes (Silverleaf failed to make the scheduled $3.5 million interest payment which was due on April 1, 2001, and failed to cure that default; it also has made no subsequent payments, including missing the Oct. 1 coupon). The new notes will bear an interest rate of between 5% and 8%, depending on the percentage of existing notes which are tendered under the exchange offer. If 80% are tendered, the rate will be 5%; if 98% or more are tendered, the rate will be 8%. The new notes will be callable from April 1, 2003 onwards at 105.25, declining to 103.5 in 2004, 101.75 in 2005 and par in 2006. The stock being offered to the noteholders under the exchange offer represents 65% of Silverleaf's equity. The exchange offer is contingent on at least 80% of the existing notes being tendered and also includes a consent solicitation, under which the existing notes' indenture would be amended to waive existing defaults, eliminate substantially all restrictive covenants, and subordinate the existing notes to the new notes. Silverleaf further said in the SEC filing that it had obtained an agreement from its lenders to amend its senior credit facilities.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.