Pediatric Services buys back additional 10% '08 notes

Pediatric Services of America, Inc. (Caa1/B) said on Friday (June 7) that it had repurchased an additional $3 million of its outstanding 10% senior subordinated notes due 2008. The repurchase was the latest in a series of repurchase transactions dating back to last summer, and lowered the amount of the notes remaining outstanding to $24.35 million from $27.35 million previously. In the latest buyback, the $3 million of notes were purchased in two private transactions for a total of $2,905,000 cash, plus accrued interest. As a result, the company anticipates that this repurchase will result in a pre-tax extraordinary gain of approximately $30,000, net of the write-off of the related deferred financing fees, in the quarter which ends on June 30. AS PREVIOUSLY ANNOUNCED: Pediatric Services, a Norcross, Ga.-based provider of pediatric home health care services, said on Oct. 10 that it had repurchased an additional $5 million of its 10% notes (this following a previous private purchase of $700,000 of the notes, which had been announced on Aug. 15). The Oct. 10 transaction brought the remaining outstanding amount of the notes down to $27.35 million from $32.35 million previously. The company purchased the notes in a private transaction for $4,493,750 cash, plus accrued interest, and said that as a result, it expected to record a pre-tax extraordinary gain of approximately $387,000, net of the write-off of the related deferred financing fees, in the quarter that ended Dec. 31

Premcor's Sabine River completes restructuring consented to by Port Arthur noteholders

Premcor Inc. (Ba3/BB-) said on Friday (June 7) that its Sabine River Holding Corp. subsidiary had completed a restructuring permitted by its recent successful solicitation of consents from the holders of its Port Arthur Finance Corp. 12½% senior notes due 2009. Premcor said the restructuring resulted in Sabine and its subsidiary companies becoming wholly owned direct or indirect subsidiaries of The Premcor Refining Group Inc., a wholly owned indirect subsidiary of Premcor Inc., which fully and unconditionally guaranteed the payment obligations under the Port Arthur notes. Premcor said the consent of the Port Arthur noteholders allowed the company to simplify its previous, overly complicated and expensive corporate structure. It also let Premcor make available $137 million of cash at Sabine, which was earning annual interest of 2% to pay off debt at par that was costing the company over 7% annually. Premcor said it used approximately $84 million generated from its recent successful initial public offering to pay off the remaining balance of its $221 million of Port Arthur-related bank debt. Premcor further said that it was "rapidly reaching" its goal of cutting its $125 million annual interest burden in half, and reducing its debt-to-total-capitalization ratio to 50%. Premcor said it has now repaid about $567 million of debt, representing an annual interest savings of $52 million, and it anticipates further debt reductions before the end of the second quarter. AS PREVIOUSLY ANNOUNCED, Sabine River, before the restructuring transaction which made it a subsiudiary of Premcor Refining Group, was a 90 %- owned subsidiary of Premcor Inc. (Ba3/BB-), a petroleum products refiner based in Old Greenwich, Conn. which formerly sold high yield debt under the names of its Clark Refining Group Inc. and Clark USA Inc. subsidiaries, (now known as Premcor Refining and Premcor USA Inc., respectively). The company said on May 16 that its Port Arthur, Texas-based refining subsidiaries, Port Arthur Finance and Port Arthur Coker Co. would solicit the consent of the Port Arthur Finance 12½% notes to proposed changes in the notes' financing and security documents, aimed at facilitating a proposed restructuring that would, among other things, permit the prepayment of $221.4 million of Port Arthur Finance's existing bank debt and result in Sabine River Holding Corp. and its subsidiary companies becoming wholly owned direct or indirect subsidiaries of Premcor Refining Group. Sabine River said that If the amendments were to become effective, Premcor Refining Group would fully and unconditionally guarantee the payment obligations under the Port Arthur Finance 12½% notes. The consent solicitation was set to expire at 5 p.m. ET on May 29, subject to possible extension (although it was not extended). The consent solicitation was conditioned upon the receipt of valid consents from at the holders of at least a majority of the aggregate principal amount of the outstanding notes, and on the satisfaction or waiver of certain other conditions, including the rating agencies reaffirming their credit ratings on the 12½% notes after giving effect to the proposed amendments and restructuring. Sabine River said that In order to be eligible for the consent fee of $20 per $1,000 principal amount of the notes, holders had to deliver their consents on or before the consent solicitation expiration deadline. It said consents could be revoked any time prior to the expiration of the solicitation, but not after that. The company said that the Premcor Refining Group guarantee had not been, and would not be, registered under the Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. On May 30, Sabine River said that the Port Arthur subsidiaries had received valid consents from the holders of 97% of the outstanding Port Arthur Finance 12½% notes to the proposed changes, when the consent solicitation expired as scheduled on May 29 without extension. The closing of the consent and a related restructuring and the payment of the consent fee to qualifying holders was expected to occur on or about June 5.

AK Steel prices new deal; proceeds to refinance 9 1/8% '06 notes

AK Steel Corp. (B1/BB) was heard by high yield syndicate sources to have sold $550 million of new 7¾% senior notes due 2012 on Thursday (June 6). Proceeds of the bond offer are to be used to re-finance its $550 million of existing 9 1/8% senior notes due 2006. AS PREVIOUSLY ANNOUNCED, AK Steel, a Middletown, Ohio-based producer of carbon, stainless and electrical flat-rolled steel, said on June 3 that it planned to sell $550 million of new ten-year notes in the Rule 144A market, and would use the expected proceeds of the offering to re-finance the 9 1/8% notes. AK did not give a timetable for the expected refinancing of the existing notes. High yield syndicate sources heard that the company would begin a short roadshow for the new offering Tuesday (June 4), with pricing likely for Thursday (June 6) via book-running manager Credit Suisse First Boston and co-manager Goldman Sachs.

Newmont Mining's Yandal unit completed tender for Normandy 8 7/8% notes

Yandal Bond Company Ltd. (Ba2) said that its cash tender offer for all of the outstanding 8 7/8% senior notes issued by Normandy Yandal Operations Limited - the former Great Central Mines Ltd. - expired at 5 p.m. ET on May 14. Yandal said that under the terms of the offer, withdrawal rights expired at 5 p.m. ET on May 16. Yandal - the Australian mining subsidiary of Newmont Mining Corp., a Denver-based international precious metals mining company - said in a May 17 release that it had been advised by the depositary for the offer that as of 5 p.m., ET on May 16, holders of the notes had validly tendered and not withdrawn $62.78 million principal amount at maturity of the notes, and that all of those notes have been accepted by Yandal Bondco for purchase under the offer. It was further advised by the depositary that the notes accepted for purchase under the offer will be promptly purchased and paid for by Yandal Bondco. Mellon Investor Services LLC (call 888 451-6741) was the information agent and the depositary for the offer.

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