Frontier accepts early tenders for $564 million 9¼% senior notes

By Jennifer Chiou

New York, Oct. 1 - Frontier Communications Corp. announced that it accepted the early tenders for $564 million of its $640,512,000 of 9¼% senior notes due 2011 in the offer for up to $700 million total of any and all of the 9¼% notes and a portion of its $700 million of 6¼% senior notes due 2013.

As of 5 p.m. ET on Sept. 30, the early deadline, roughly $419 million of the 6¼% notes had been tendered.

As already reported, the company will purchase as many 6¼% notes as it can for a total payment that is equal to the lesser of $250 million and the difference between $700 million and the total payment made for tendered 9¼% notes.

Frontier added that holders may still tender the remaining 9¼% notes.

The offer ends at 9 a.m. ET on Oct. 16. It began on Sept. 17.

For each $1,000 principal amount, the Stamford, Conn.-based communications company said it will pay $1,092.50 for the 9¼% notes and par for the 6¼% notes, including a $30.00 tender premium for those who tendered by the early deadline.

The company will also pay accrued interest to the payment date.

Frontier said the offer is subject to the satisfaction or waiver of a number of conditions, including the completion of its concurrent note offering of not less than $450 million of unsecured senior debt securities that closes no later than Oct. 16.

On Thursday, the company said it wrapped its offering of $600 million of 8 1/8% senior notes due 2018 at a price of 98.441% of par, for net proceeds of about $577.6 million.

"The successful note offering and the early results of the tender offer follow our successful note offering in April 2009 and our 2009 open market repurchases, all of which have materially reduced our shorter term refinancing risk and, together with our $250 million undrawn revolving credit facility, provide us with significant financial flexibility," Don Shassian, Frontier's chief financial officer, said in a news release.

Credit Suisse Securities (USA) LLC (800 820-1653 or call collect 212 538-1862) is the coordinating dealer manager, and Citigroup Global Markets Inc. and J.P. Morgan Securities Inc. are the co-dealer managers. MacKenzie Partners, Inc. (800 322-2885 or call collect 212 929-5500) is the information agent.

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