Tenneco redeems remaining 8 5/8% notes after close of tender offer

By Susanna Moon

Chicago, Jan. 10 - Tenneco Inc. completed the cash tender offer for its $500 million 8 5/8% senior subordinated notes due 2014, purchasing about $480 million principal amount of the notes, according to an 8-K filing with the Securities and Exchange Commission.

The tender offer ended at 8 a.m. ET on Jan. 6. The following day, Tenneco redeemed the remaining $20.03 million principal amount of notes at 102.875.

The amount of notes tendered in the offer is unchanged from 5 p.m. ET on Dec. 22, the expiration date for the consent solicitation. The offer began on Dec. 9.

The company received more than the consents needed to amend the notes and, as a result, executed a supplemental indenture that eliminated substantially all of the restrictive covenants and event-of-default provisions and reduced the minimum notice period required to effect a call for redemption to five days from 30 days.

Tenneco made a cash payment of $1,032.50 per $1,000 principal amount, which includes a consent payment of $30.00, for notes tendered by the consent deadline.

The company also paid accrued interest up to but excluding the payment date, which was Dec. 23 for notes tendered by the consent deadline.

Funding for the payment came from proceeds of the company's private offering of $500 million 6 7/8% senior notes due Dec. 15, 2020, which closed Dec. 23.

Tenneco previously said it expected to record about $20 million and $1 million of non-recurring pre-tax charges related to retiring the notes in the fourth quarter of 2010 and first quarter of 2011, respectively.

The tender offer required the receipt of consents from holders of a majority of the outstanding notes, the execution of a supplemental indenture effecting the proposed amendments and the satisfaction of a financing condition.

Bank of America Merrill Lynch (888 292-0070 or 980 388-9217) was the dealer manager and solicitation agent for the offer. Global Bondholder Services Corp. (212 430-3774) was the depositary and information agent.

Tenneco is a Lake Forest, Ill.-based designer, manufacturer and marketer of emission control and ride control products and systems for the automotive original equipment market and the aftermarket.

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