Avery Dennison gets tenders for more than 75% of HiMEDS convertible units

By Angela McDaniels

Tacoma, Wash., March 4 - Avery Dennison Corp. said preliminary results show that 6,612,978, or 75.15%, of its 7.875% HiMEDS mandatory convertible equity units were tendered during an exchange offer that ended at 12:01 a.m. ET on March 4.

The company began the offer to exchange up to 8.36 million, or 95%, of the HiMEDS units for shares of common stock and cash on Feb. 3.

The HiMEDS units have a stated amount of $50.00 each and comprise a purchase contract for common stock and a 5% undivided beneficial interest in a $1,000 principal amount 5.35% senior note due Nov. 15, 2020.

Holders who tendered will receive 0.9756 of a share and $6.50 in cash, which includes accrued interest on the 5.35% notes, for each HiMEDS unit. Settlement is expected to occur on March 10.

Avery Dennison has accepted all of the tendered HiMEDS units and expects to issue roughly 6.45 million shares and pay $42.98 million in cash to the unitholders, according to a company news release.

The exchange will result in the retirement of $330.65 million of the 5.35% notes.

The company announced plans for the exchange offer on Jan. 27. At the time, it said that although the units do not require mandatory settlement until November 2010, it believes that taking the dilution now is appropriate given the benefits of having lower leverage in today's environment.

D.F. King & Co., Inc. (800 758-5880 or collect 212 269-5550) was the exchange agent and information agent.

Avery Dennison is based in Pasadena, Calif., and makes identification and decorative products.

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