Equinix retires another $10 mln of 13% '07 notes

Equinix, Inc. said on Wednesday (June 12) that it has retired an additional $10 million of its 13% senior notes due 2007. Including the $42 million of senior notes which were retired in debt exchanges in the first half of 2002, that brings the total face amount of the notes which have been retired at significant discounts to $52 million. Since October 2001 it has reduced its total outstanding debt by $97 million, including the retirement of $45 million in senior credit facility debt in October 2001. The debt reductions have reduced the company's annual interest expense by nearly $10 million, with the company's total debt obligations, including principal and interest over the term of the debt, to be reduced by approximately $150 million. In addition, Equinix announced the filing of a proxy statement with the Securities and Exchange Commission calling for a special stockholders' meeting to approve the potential issuance of up to 15 million shares of Equinix common stock in exchange for the retirement of additional senior notes. The total number of common stock shares outstanding is currently 96.9 million shares. Equinix said that the ability to issue additional common shares would give it greater flexibility and options to de-leverage the company. While Equinix said it does not expect to transact any additional debt for equity exchanges in the near term at the current stock trading level, the availability of additional authorized shares would enable the company to take advantage of favorable debt for equity exchange opportunities as market conditions improve. AS PREVIOUSLY ANNOUNCED, Equinix, a Mountain View, Calif.-based provider of core Internet exchange services, said on March 7 that it had retired $25 million of the 13% notes in exchange for approximately nine million shares of Equinix common stock. The company said the retirement of these notes would result in an annual savings of approximately $3.25 million in interest expense, which would be realized over the full year beginning in fiscal 2002. As of the date of that release, Equinix said it had reduced its interest payments on the retired senior notes beginning January, 2002 through December, 2007 by $19.5 million. Together with the $25 million in principal payments that would otherwise have come due in December 2007, Equinix said it had reduced its debt service on the retired senior notes by nearly $45 million. With the transfer of the nine million shares to the former holders of the $25 million of retired notes, the total number of common stock shares outstanding upon completion of the exchange was approximately 89 million shares.

AK Steel calls 9 1/8% '06 notes for redemption

AK Steel Corp. (B1/BB) said on Tuesday (June 11) that it would redeem all $550 million of its outstanding 9-1/8% senior notes due 2006 on July 11, financing the redemption is being financed with the proceeds from its recent issue of new 7¾% senior notes due 2012. The 9 1/8% notes will be redeemed at a price of 104.56% of their par value (i.e., $1,045.60 per $1,000 principal amount). 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 at that time 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. On June 6, the syndicate sources reported that AKS had sold $550 million of new 7¾% senior notes due 2012.

Telefonica de Argentina early consent pay deadline for 9 1/8% '08 notes ends

Telefonica de Argentina (Ca/SD) on Monday (June 10) announced the end of the early consent payment period under its solicitation of noteholder consents to amending the "payment event of default" provision in the indenture of its $368.5 million of 9 1/8% notes due 2008. The company said it has already received Letters of Authorization which authorize the requisite votes to approve the proposed amendment at the upcoming noteholders' meeting, which is to be held on June 21. The final expiration date for holders to submit their authorization to the proposed change is 5:00 p.m. ET on June 14. TAR said the proposed amendment brings the "payment event of default" under the company's Euro Medium-Term Note Program, or EMTNP, into conformity with the "payment events of default" under the company's other public indebtedness, by clarifying that a "payment event of default" under one series of notes under the EMTNP will not automatically cause an "event of default " under an unrelated series of notes issued under the EMTNP. Telefonica de Argentina said Morgan Stanley & Co. (call Simon Morgan at 212 761-2219 or Brendan Goffinet at 212 761-1269 or, in London, Anna Khazen at 44 207 677-5715 or Patrick Mullins at 44 207 677-6680) is the solicitation agent. AS PREVIOUSLY ANNOUNCED, the corporate parent of Buenos Aires-based Argentine telecommunications provider Telefonica de Argentina - Spanish-based telecom operator Telefonica SA (A2) - said in an e- mailed note sent to Spanish market regulators on May 22 that Telefonica de Argentina would offer up to $100 million in new bonds in exchange for outstanding debt, although Telefonica SA didn't provide details of the new bonds. Telefonica de Argentina has $100 million in bonds maturing on July 1 - part of $1.1 billion in debt maturing some time this year, according to figures compiled by Standard & Poor's. On May 29, the Fitch ratings service disclosed further information about the pending transactions, saying the exchange offer may include the payment of up to $15 million [presumably cash] and an exchange of $85 million in new bonds for the balance. The new bonds would have similar terms as the original issuance, including a 9 7/8% coupon; final terms have not been disclosed.

Doe Run begins exchange and cash tender offers for '03, '05 notes

The Doe Run Resources Corp. (Ca/B-) said in a Securities and Exchange Commission filing on June 6 that it had begun an offer to exchange new notes plus a cash accrued interest payment for its outstanding 11¼% Series B senior secured notes due 2005, its outstanding 11¼% Series B senior notes due 2005 and its outstanding Series B floating interest rate notes due 2003; had begun a concurrent cash tender for those three series of notes; and had begun a related solicitation of noteholder consents to proposed changes in the indentures governing those notes. Doe Run is also offering noteholders who choose to participate in the exchange offer the option of also participating in its new senior credit facility as co-lenders. The terms of the offers are the same as those which Doe Run had already outlined in a previous SEC filing. In its latest filing, the company also said that the exchange offer, the cash tender offer and the right of participation in the senior loan would each expire at 5 p.m. ET on July 9, subject to possible extension. Tendered notes may be withdrawn at any time prior to the expiration date. AS PREVIOUSLY ANNOUNCED: On April 15, The Doe Run Resources Corp., a St. Louis-based metals smelting company, announced that it had reached an agreement in principle with its corporate parent, New York-based industrial conglomerate The Renco Group, Inc. and with Regiment Capital Advisors, LLC under which Renco and Regiment would provide Doe Run with significant capital that would enable Doe Run to restructure its existing debt. Under that agreement in principle, Renco said it would purchase $20 million of Doe Run preferred stock and Regiment - already a significant holder of Doe Run's 11¼% senior and senior secured notes and its floating interest rate notes - said it would commit to lend Doe Run $35 million, and would offer other holders of Doe Run notes the opportunity to participate in making such loan. Doe Run said it planned to make a cash tender offer for a portion of its notes, and an exchange offer for the balance of the notes. The $55 million in proceeds of the Renco investment and the Regiment loan would be used to finance the cash tender offer, to pay the accrued interest as of March 15 on the notes that would be exchanged in the exchange offer, and to pay certain costs of those transactions. Doe Run said that if they were successful, the cash tender offer and the exchange offer would significantly reduce its outstanding debt. Doe Run would meanwhile be able to continue to operate all its facilities at present levels, and Doe Run's trade creditors would not be adversely affected. Besides the $20 million investment, Renco would also provide Doe Run with credit support of up to $10 million, if necessary, to provide additional working capital. Doe Run said the non-binding agreement in principle would be subject to agreement on the terms of definitive documentation and further said that the successful completion of the planned transactions would be subject to several conditions, including, among others, the participation by holders of 90% of the principal amount of each class of notes in the cash tender offer and/or the exchange offer, and the satisfactory modification of Doe Run's U.S. and Peruvian revolving credit facilities (Doe Run originally issued $200 million of the 11¼% senior notes, $50 million of the 11¼% senior secured notes and $55 million of the floating rate notes). Doe Run said it anticipates the completion of definitive documentation for the Regiment loan and the Renco investment within 30 days of its press release, at which time more detailed terms would be announced and the cash tender offer and exchange offer would be commenced. On May 16, Doe Run outlined the terms of the agreement in principal and announced its tender offer and exchange offer for the notes in an 8-K filing with the Securities and Exchange Commission. The company did not initially disclose expiration deadlines for either offer nor did it disclose deadlines for the related consent solicitations. Doe Run said that under the terms of its exchange offer, it would offer the holders of its outstanding 11¼% senior secured notes $770 per $1,000 principal amount of the notes in new Doe Run 11¼% exchange notes due 2007, plus a cash payment of $56.25 per $1,000 principal amount equal to the amount of accrued and unpaid interest through March 15. It would offer the holders of its existing 11¼% senior notes $670 per $1,000 principal amount of the notes in new exchange notes, plus the $56.25 per $1,000 principal amount interest payment, and it would offer the holders of the existing floating rate notes $670 per $1,000 principal amount of the notes in new exchange notes, plus an accrued interest payment of $46.90 per $1,000 principal amount. Doe Run said the exchange offer would be open only to those holders who could reasonably be defined as Accredited Investors under Rule 501 (a) of the Securities Act of 1933. Doe Run said that simultaneously with the exchange offer, it would begin a cash tender offer for the outstanding notes, under which it would offer to buy the notes at a price between $250 and $350 per $1,000 principal amount. Doe Run said that it will select as the cash payment the highest price specified by any noteholder that would enable the company to purchase the maximum amount of notes while not exceeding its target aggregate purchase price of $44 million. Doe Run will pay the same cash payment for all of the notes which have been validly tendered at or below that cash payment price and not subsequently withdrawn, upon the closing of the transaction. It said that holders whose notes were accepted for purchase under the cash tender offer would not be eligible to receive any interest payment on them above the cash payment price. Any holder tendering notes under the cash tender offer would also be considered to have tendered them under the exchange offer as well. Should the amount of notes tendered under the cash tender offer and not subsequently withdrawn exceed the amount that the company would be able to buy and still stay within its available cash aggregate purchase price of $44 million, Doe Run would first accept for payment all notes tendered below that cash payment price and would then accept notes tendered at the cash payment price on a pro-rata basis. Any notes thus tendered under the cash tender offer which could not be purchased for cash would then be exchanged for the appropriate amount of new exchange notes and the appropriate cash interest payment . Doe Run said that should a holder choose to neither tender his existing notes under the exchange offer nor the cash tender offer, it reserves the right to leave such unexchanged or unpurchased notes outstanding upon the conclusion of its offers; it also, however, reserves the right (but is under no obligation) to subsequently purchase such notes as permitted under the terms of its new senior credit facility either on the open market or in negotiated transactions, either for similar or for different consideration as it is offering under the exchange offer and the cash tender offer. It also reserves the right to defease the remaining outstanding notes or to redeem them under the terms of their indentures. Any remaining outstanding notes will be subject to indenture changes for which Doe Run is seeking noteholder consent concurrently with its exchange and cash tender offers. Doe Run said the tender of notes under either the exchange offer or the cash tender offer will be considered to constitute noteholder consent to the proposed indenture amendments, which would eliminate substantially all of the restrictive operating and financial covenants in the indentures, and which would modify a number of the "event of default" provisions, and various other provisions currently contained in the existing notes' indentures. Doe Run also said that in connection with the offers, it would enter into a new $37.5 million, four-year senior secured credit facility with Regiment Capital Advisors, and that it would offer noteholders who initially elect to participate in the exchange offer the opportunity to participate as co-lenders under the New Senior Credit Facility on a pro-rata basis, based upon those noteholders' respective interests in the existing notes initially tendered in the exchange offer. The participation of the noteholders as co-lenders will be subject to Regiment's right, in its sole and absolute discretion, to lend at least 60% of the aggregate principal amount of the Initial Senior Loan. Each noteholder who elects to participate in the Initial Senior Loan will also participate as a co-lender in any subsequent senior loan approved by Doe Run's existing lenders on a pro- rata basis, in accordance with such noteholder's percentage interest in the Initial Senior Loan. The proceeds of the Initial Senior Loan will be used to consummate the exchange offer and the cash tender offer. Noteholders choosing to participate in the Initial Senior Loan will receive warrants exercisable for up to 20% of the fully diluted common stock of Doe Run, at an initial total exercise price of $2,000,000. The warrants would be distributed to the participating noteholders on a pro-rata basis in accordance with such participant's interest in the Initial Senior Loan. Consummation of the cash tender offer and the exchange offer, as well as related transactions, will be conditioned upon a number of conditions including - but not limited to - the valid tender (without subsequent withdrawal) of at least $125,000,000 total principal amount of the existing notes under the cash tender offer; the participation by 90% of the outstanding principal amount of each of the three series of existing notes in the exchange offer and/or the cash tender offer; and the receipt of the requisite consents to the proposed indenture changes. Doe Run said it expected to launch the tender offer and exchange offer by the last week of May, and warned that there could be no assurance that it would be able to successfully complete the transactions described.

LSB's ClimaChem buys back $52 mln 10¾% notes

LSB Industries, Inc. said on May 29 that its ClimaChem, Inc. (Caa3/CC) subsidiary had completed a transaction to repurchase $52.3 million of its 10¾% senior unsecured notes at a substantial discount from their face amount. LSB, an Oklahoma City-based maker of chemicals and air conditioning system components, said the purchase and related costs were financed by a $35 million secured loan due 2005. It said the majority of the selling noteholders were affiliates of the lenders. Prior to the transaction - which had not been publicly announced beforehand - some $70.6 million of the outstanding notes had been owned by unrelated third parties. Following the transaction, $18.3 million of the notes remain outstanding. The company said that prior to the purchase of the notes, their indenture indenture was substantially modified to eliminate numerous covenants and other provisions of the indenture.

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