AES to buy back $762.6 million of notes in tender offers

By Susanna Moon

Chicago, June 19 - AES Corp. said it accepted for purchase $762.6 million of senior notes in its previously announced tender offer, which expired at midnight ET on June 18.

AES received tenders for $341.632 million of its $752.553 million 8¾% second priority senior secured notes due 2013 of which it accepted $62.299 million for purchase. That level was set by taking the cap for the notes of $377.03 million and subtracting the $314.731 million for which consents were delivered without the notes being tendered.

AES also accepted all $313.771 million of its $467.308 million outstanding 9½% senior notes due 2009 that were tendered, slightly more than the announced cap of $313 million.

AES accepted all $209.056 million of the $422.665 million outstanding 9 3/8% senior notes due 2010 that were tendered, again slightly more than the cap of $208 million.

AES accepted all $177.465 million of its $306.805 million outstanding 8 7/8% senior notes due 2011, again a little above the $176 million cap.

On June 5, the company announced modifications to the terms of its tender offer for several series of its notes, including the extension of the offer to midnight ET on June 18 from June 11.

The offer began on May 14.

On May 29, the company said it received the needed consents for its 8¾% second-priority senior secured notes due 2013 after receiving tenders for $341.2 million of the notes as well as consents without tenders for $314.4 million of notes. The solicitation ended at 5 p.m. ET on May 28.

The company was tendering for up to $759.3 million total, increased from up to $377.03 million total, of four series of senior notes, including the 8¾% notes.

In priority acceptance order, affected notes include up to:

• $377.03 million of its $752.55 million of 8¾% notes;

• $313 million, increased from up to $240 million, of its $467.31 million of 9½% senior notes due 2009;

• $208 million, boosted from up to $180 million, of its $422.67 million of 9 3/8% senior notes due 2010; and

• $176 million, augmented from up to $120 million, of its $306.81 million of 8 7/8% senior notes due 2011.

As of 5 p.m. ET on June 3, untendered note consents for the 8¾% notes amounted to $314.7 million.

As of 5 p.m. ET on June 4, holders had tendered $312.8 million of the 9½% notes, $207.2 million of 9 3/8% notes and $175.4 million of 8 7/8% notes.

As of the early deadline, holders had tendered $312.8 million of the 9½% notes, $207.2 million of 9 3/8% notes and $175.2 million of 8 7/8% notes.

The company solicited consents from holders of its 8¾% notes to proposed amendments to the indenture, which will eliminate many of the restrictive covenants in the indenture. Noteholders could have delivered consents without tendering their 8¾% notes.

As a result, AES said it received consents representing $655.6 million, or 87%, of the 8¾% notes, adding that it has entered into a supplemental indenture.

For each $1,000 principal amount, holders who tender will receive $1,043.75 for the 8¾% notes, $1,055.00 for the 9½% notes, $1,077.50 for the 9 3/8% notes and $1,065.00 for the 8 7/8% notes. All payouts include a $20.00 early participation payment for those who tender by 5 p.m. ET on May 28, and the payout for the 8¾% notes includes a $3.75 consent fee assuming that consents are delivered for a majority of notes.

AES was seeking consents from holders of a majority of the 8¾% notes.

Citi (800 558-3745 or call collect 212 723-6106) and Lehman Brothers (800 438-3242 or call collect 212 528-7581) are the dealer managers. Global Bondholder Services Corp. (866 873-7700 or call collect 212 430-3774) is the information agent and the depositary.

AES is an Arlington, Va.-based generator and distributor of electricity.

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