Eschelon $65 million notes add-on talked at 80.0-80.25, to price Friday

By Paul A. Harris

St. Louis, Nov. 18 - Eschelon Operating Co.'s $65 million add-on to its 8 3/8% senior secured second priority notes due March 15, 2010 (existing Caa1/confirmed CCC+) were talked Thursday at a dollar price of 80 to 80.25, according to a market source.

The notes are expected to price on Friday.

Jefferies & Co. is the bookrunner.

The notes are callable from March 15, 2007 at 106.0, with the call premium declining annually from that date to 103.0 and then par. The notes also contain an equity clawback until March 15, 2007 for 35% at 112.0.

Proceeds will be used to fund the acquisition of Advanced Telecom, as well as to repurchase convertible preferred shares and for general corporate purposes.

The original $100 million issue priced at 84.813 on March 10, 2004, to yield 12%.

The prospective issuer is a Minneapolis-based voice, data and internet services provider.

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