Insight Communications to refinance 10%' 06 and 12 7/8% '08 notes

New York, July 22 - Insight Communications Co. Inc. said that it plans to refinance all of the indebtedness of its Ohio operating subsidiary, which includes $140 million of 10% senior notes due 2006 and $55.9 million of 12 7/8% senior discount notes due 2008.

The Ohio debt also includes a $22.5 million senior credit facility. The New York-based cable-TV systems operator said that the transaction will be accomplished through the refinancing of a $900 million term loan under Insight Midwest's existing credit facility into a new $1.125 billion term loan, increasing the total credit facility size to $1.975 billion.

Packaging Corp. of America completes 9 5/8% '09 notes tender

New York, July 22 - Packaging Corp. of America (Ba2/BBB- ) said that it had completed its previously announced repurchase of its 9 5/8% senior subordinated notes due 2009 as part of several transactions composing its planned debt refinancing.

The company said that it had received tenders for and had repurchased an aggregate principal amount of $546.4 million of the notes, or 99.3% of the outstanding amount, as of the offer's expiration, which occurred as scheduled at midnight ET on July 21, without extension.

The debt refinancing, which besides the repurchase of the 9 5/8% notes also included the paydown earlier this month of the last $79 million of its original $1.219 billion in bank debt, will reduce annual interest expense going forward by $33 million or 19 cents a share, the company said.

As previously announced, Packaging Corp., a Lake Forest, Ill. packaging company, said on June 23 that it was starting a cash tender offer for all its $550 million of 9 5/8% notes and was also soliciting consents to amend the notes' indenture to eliminate substantially all restrictive covenants and certain event of default provisions.

It set 5 p.m. ET on July 7 as the now-expired consent deadline and said the tender offer would expire at midnight ET on July 21, with both deadlines subject to possible extension.

Packaging Corp. did not initially set a price, but said one would be announced later, based on a formula including a 62.5-basis point spread over the yield on a reference security, the 3 5/8% Treasury note due March 31, 2004. It said the price would include a consent payment of $20 per $1,000 principal amount of the notes for those notes tendered by the consent deadline.

Notes tendered after the consent deadline would not receive the consent payment.

The company also said that notes not tendered would be redeemed as soon as possible after the earliest redemption date at the redemption price of 104.8125% of the principal amount.

Packaging Corp. said it would finance the tender offer with a private placement of new notes, proceeds of a new bank credit facility and cash on hand.

On July 7 Packaging Corp. announced that it had received sufficient consents to the proposed indenture terms by the now-expired consent deadline. It said that notes which had been tendered could no longer be withdrawn and the related consents could not be revoked, except in limited circumstances described in the official offer to purchase.

Accordingly, Packaging Corp. and the notes' indenture trustee said they planned to promptly execute and deliver a supplemental indenture incorporating the proposed amendments, although the company also said that the amendments would not become operative unless and until Packaging Corp. were to accept the notes for purchase under the terms of the tender offer following its expiration. Once the proposed amendments became operative, holders of all the notes then outstanding would be bound by them.

On July 14, the company said it would offer to sell $550 million in aggregate principal amount of new five- and 10-year senior notes in a Rule 144A transaction, with the net proceeds of the offering, together with available cash and borrowings under a new senior unsecured credit facility, to be used to purchase all the 9 5/8% notes. High yield syndicate sources said the company sold the notes in two tranches the following session.

On July 17, Packaging Corp. said that it would pay $1,102.40 per $1000 principal amount for the 9 5/8% notes, plus accrued interest up to but not including the payment date.

The figure included a consent payment of $20 per $1,000 principal amount for holders who tendered by the July 7 consent deadline.

Packaging Corp. also said that as previously promised, it had executed and delivered a supplemental indenture containing the proposed indenture amendments, acting along with the subsidiary guarantors and the indenture trustee.

Morgan Stanley (800 624-1808 or 212 761-1123 (collect), attention: Jeff Kelly) and Goldman Sachs (877 686-5059 or 212 357-5680 (collect), attention: Liability Management Group) were dealer managers for the tender and Georgeson Shareholder Communications (800 248-3170) was information agent.

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