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Smithfield Foods wraps, prices Dutch auction tender for 7¾%, 10% notes
By Susanna Moon
Chicago, Feb. 10 - Smithfield Foods, Inc. said it completed the Dutch auction tender offer for the maximum amount of its $350 million of 7¾% senior notes due 2013 and $850 million of 10% senior secured notes due 2014 that it can purchase for $450 million.
The offer expired at midnight ET on Feb. 9, and Smithfield accepted $390.9 million principal amount of notes. The total purchase price, including accrued interest, for the offer was $454.9 million.
The company spent $214,380,121 to purchase $190,003,000 principal amount of the 7¾% notes and $240,491,275 to buy $200,921,000 principal amount of the 10% notes.
For each $1,000 principal amount, holders received $1,110 for the 7¾% notes and $1,190 for the 10% notes.
The clearing premium per $1,000 principal amount of notes was $35.
The acceptable bid price range was $1,075 to $1,110 for the 7¾% notes and $1,155 to $1,190 for the 10% notes.
The total payment for each $1,000 principal amount of notes was the base price for that series of notes plus the clearing premium, which was the lowest single bid premium that allowed the company to purchase the maximum principal amount of notes for $450 million.
The ranges included the early participation payment, and the low end of each range was the base price for that series.
The company also paid accrued interest.
Smithfield increased the maximum payment amount for the offer on Jan. 27 to $450 million from $350 million.
The company also decided to pay the total amount, including an early participation payment of $30 per $1,000 principal amount of notes, for all notes accepted for purchase. Before the change, the total payment was available only to those who tendered by 5 p.m. ET on Jan. 26, the early participation deadline.
Goldman Sachs & Co. (800 828-3182 or call collect 212 902-5128) was the dealer manager. Global Bondholder Services Corp. (866 924-2200) was the depositary and information agent.
Smithfield Foods is a pork processor and hog producer based in Smithfield, Va.
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