Brocade Communications to refinance debt, issue $600 million notes

By Paul A. Harris

St. Louis, Jan. 4 - Brocade Communications Systems, Inc. announced on Monday that it plans to attempt a $600 million placement of senior secured notes.

The San Jose, Calif., developer and manufacturer of networking technologies disclosed the Rule 144A and Regulation S deal in an 8-K document filed with the Securities and Exchange Commission.

Of the proceeds, $150 million, together with cash on hand, will be used to retire about $173 million of outstanding 2¼% subordinated convertible notes originally issued by wholly owned subsidiary McDATA Corp.

The balance of the proceeds will be used to pay down a portion of Brocade's outstanding term loan.

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