Electroglas to exchange $25 million 5.25% convertibles for cash, stock

New York, May 3 - Electroglas, Inc. said it has agreed to issue cash and stock in exchange for $25 million principal amount of its 5.25% convertible subordinated notes due 2007.

For each $1,000 principal amount of notes, the company will issue 170.73 shares and pay $300 in cash plus accrued interest.

The total payment will be 4.268 million shares and $7.5 million plus accrued interest.

Closing is expected on May 5.

"We view the exchange as an important strategic step towards improving our balance sheet and liquidity," said Electroglas chief financial officer Tom Brunton in a news release. "We believe the exchange better positions Electroglas to capitalize on what we believe is an improving environment for our products."

Electroglas is a San Jose, Calif., supplier of wafer probers and prober-based test handling solutions for the semiconductor industry. Its stock closed at $4.69 on Wednesday.

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