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AES may seek waiver to avoid repaying bank debt with stock offering proceeds
By Sara Rosenberg
New York, June 16 - AES Corp. is required to use proceeds from a proposed public offering of 40 million shares of common stock to repay bank debt. However, the company is considering seeking a waiver to postpone or eliminate its obligations to prepay the bank debt since it is also exploring refinancing the facilities with new ones.
More specifically, the Arlington, Va. power company must use $162.5 million of the net proceeds from the offering to repay $75 million of the secured equity-linked loan due 2004 issued by AES New York Funding LLC and $87.5 million of its tranche C term loan facility under its senior secured credit facilities due 2005.
Furthermore, the company is required to use one half of the net proceeds from this offering in excess of $162.5 million to repay its obligations under its credit facilities other than its revolver, according to a news release.
AES stock closed at $8.20 Monday.
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