KLA-Tencor redemption of $750 million 6.9% notes set for Dec. 19

By Toni Weeks

San Luis Obispo, Calif., Nov. 19 – KLA-Tencor Corp. set the date on which it will redeem its $750 million outstanding principal amount of 6.9% senior notes due 2018, according to a press release.

The company will redeem the notes on Dec. 19 at a redemption price that is equal to the greater of par and the sum of the present values of the remaining scheduled payments of principal and interest on the notes to be redeemed (exclusive of interest accrued to the redemption date), discounted to the redemption date on a semiannual basis, at a rate equal to the sum of the Treasury rate plus 50 basis points. The company will also pay accrued interest to but not including the redemption date.

As previously reported, funding for the redemption will come from the company’s $1.25 billion five-year senior unsecured revolving credit and term loan facility.

When the redemption was announced on Monday, the company said it would occur “as promptly as practicable” after the closing of the facility.

Proceeds of the facility also will be used, along with the proceeds from a registered offering of about $2.5 billion principal amount of its senior notes and cash on hand, to fund a special dividend to stockholders of about $2.75 billion and for other general corporate purposes.

The Milpitas, Calif.-based company is a supplier of process control and yield management services for the semiconductor and related nanoelectronics industries.

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