Dress Barn holders tender all its 2.5% convertibles in exchange offer

By Susanna Moon

Chicago, Jan. 25 - Dress Barn, Inc. said holders tendered all $112.5 million principal amount of its 2.5% convertible senior notes due 2024. The offer expired at midnight ET on Jan. 22.

In the offer, the company will issue about 6.2 million common shares and pay about $117 million in exchange for the tendered convertibles.

Following settlement, there will be no notes outstanding.

"We are very pleased to have successfully completed this transaction with all the notes tendered for exchange. Our strong and liquid balance sheet has enabled us to eliminate this debt and the future potential dilution impact of the equity feature of the notes," David R. Jaffe, president and chief executive officer, said in a press release.

"This will benefit future earnings and is consistent with our goal of increasing shareholder value. Upon the completion of this offer we expect to have in excess of $250 million in cash and investments."

As previously reported, holders will receive $1,040 in cash plus 55.3341 shares of common stock for every $1,000 principal amount of convertibles exchanged. The company will also pay accrued interest up to but excluding the settlement date, which is expected to be Jan. 27.

The exchange ratio is equal to the quotient of a) 95.1430 shares multiplied by $25.12 - the average of the stock's daily volume-weighted average price for the five trading days ended Jan. 20 - minus $1,000 b) divided by $25.12.

The offer began Dec. 23.

J.P. Morgan Securities Inc. is the financial adviser to the company for the offer. D.F. King & Co., Inc. (800 487-4870) is the information agent.

The Suffern, N.Y.-based clothing retailer issued $115 million of the convertibles in December 2004.

© 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.