By Susanna Moon
Chicago, March 20 - TowerJazz said it agreed to exchange about $45 million principal amount of its $94 million 8% senior bonds due June 2015 for about $48 million of new 8% senior convertible bonds due December 2018 issued by Jazz Technologies, Inc.
The company signed definitive agreements with U.S. and offshore institutional holders.
The new bonds will be subordinated to the Wells Fargo credit line of up to $70 million due 2018, as are the currently outstanding bonds due June 2015, according to a press release.
In addition, some bondholders agreed to purchase about $10 million principal amount of the new bonds maturing 2018.
These transactions will strengthen TowerJazz's balance sheet by reducing net debt due through June 2015 by about $55 million, composed of an increase of about $10 million in the company's cash balance and a reduction of the bonds due June 2015 to about $49 million from about $94 million, the company said.
The new bonds may be converted into Tower shares at $10.07 per share, reflecting a 20% premium over the average closing price for the company's shares for the five trading days ended one day prior to signing date of the agreements, the release noted.
The new Jazz bonds will not be guaranteed by Tower Semiconductor Ltd.
TowerJazz manufactures integrated circuits and is based in Migdal Haemek, Israel.
New convertibles
| Issuer: | Jazz Technologies, Inc.
|
| Issue: | Senior convertible bonds
|
| Amount: | About $48 million
|
| Maturity: | December 2018
|
| Coupon: | 8%
|
| Conversion price: | $10.07 per share
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
