Camuzzi offers to purchase IEBA defaulted notes for cash

Camuzzi International SA began a cash tender offer for all outstanding senior notes of Inversora Electrica de Buenos Aires SA (IEBA).

For each $1,000 principal amount of IEBA's outstanding series A senior notes due 2002 or 9.00% senior B senior notes due 2004, Camuzzi is offering a cash payment of $100. Holders who submit their notes in the tender offer will not receive accrued and unpaid interest on those notes.

The offer is conditional on the receipt of tenders of at least 90% of the total principal amount of the outstanding notes.

It expires at midnight ET on March 31 unless extended or terminated earlier.

IEBA has not made interest payments on the notes since Sept. 16, 2001 and did not redeem the 8.65% notes when they were due Sept. 16, 2002 and remains in default on both series. Camuzzi said in a news release Tuesday that IEBA, a Buenos Aires-based energy company, has been informed by several noteholders that they plan to file bankruptcy petitions in the Argentine courts, but IEBA has not been served notice of the proceedings.

Morgan Stanley is the sole deal manager for the offer (contact Lara Berkowitz or Simon Morgan on 800 624 1808 or outside the U.S. call collect +1 212 761-1884). The information agent is Mellon Investor Services LLC (call Grainne McIntyre on 888 867-6197 or outside the U.S. call collect +1 917 320-6286). Bank of New York SA is the Luxembourg depositary.

Camuzzi owns a majority of IEBA through its 99.99% indirect shareholding in Buenos Aires Energy Co. SA, which owns 55% of IEBA. United Utilities International owns the remaining 45%.

Crown Cork & Seal announces results of tender offer

Crown Cork & Seal Co. Inc. (B1/CCC+) said Wednesday (March 5) that it had accepted for purchase all validly tendered notes under its previously announced tender offer for four series of its outstanding bond debt. The offer expired as scheduled at 12:01 a.m. ET on Wednesday, with no extension.

Crown Cork & Seal said that as of that deadline, $144.636 million of its 6¾% notes coming due on April 15 and $70.55 million of its 8 3/8% notes due 2005 had been validly tendered and not withdrawn, leaving $49.864 million and $121.7 million, respectively, still outstanding.

It also said that $81 million of the 6¾% notes coming due on Dec. 15 issued by Crown Cork & Seal Finance plc and $67.829 million of the 6¾% notes coming due on Dec. 15 issued by Crown Cork & Seal Finance SA had been validly tendered and not withdrawn, leaving $112.5 million and $116.421 million, respectively, still outstanding.

The company additionally announced that it had repurchased €145.215 million of the outstanding Crown Cork & Seal Finance SA 6 % notes due 2004 in a privately negotiated transaction.

Salomon Smith Barney Inc. (call toll-free at 800 558-3745 or collect at 212 723-6106) was the dealer manager for the tender offers. The information agent and depositary was Mellon Investor Services LLC (call 800 903-7594).

AS PREVIOUSLY ANNOUNCED: Crown Cork & Seal, a Philadelphia-based maker of beverage cans and other packaging for consumer products, said on Jan. 29 that it would embark on a comprehensive refinancing plan valued at more than $3 billion, which would consist of $1.05 billion of first lien bank debt, the issuance of $1.75 billion in senior secured second and third lien notes, and the receipt of gross proceeds from the issuance of convertible notes and debt-for-equity exchanges totaling $325 million. The plan would result in substantially all of the company's debt having stated maturities in 2006 and beyond.

The plan envisioned the refinancing of approximately $900 million of Crown Cork's senior notes, including all of the notes scheduled to mature in 2003 and approximately $300 million of the notes due in 2004 and 2005. A portion of the proceeds from the refinancing would also be used to refinance the company's existing revolving credit facility, which is scheduled to mature in December, as well as to pay fees and expenses associated with the refinancing.

Crown Cork expected the refinancing to be completed by the end of the first quarter.

On Feb. 4, Crown Cork officially announced that it had begun concurrent tender offers for four series of notes issued by the company and two financing subsidiaries, as part of the refinancing plan.

Crown Cork said it would tender for its $194.5 million of outstanding 6¾% notes which are scheduled to mature on April 15, and $192.25 million of outstanding 8 3/8% notes due 2005. It is also tendering for the $193.5 million of 6¾% notes issued by its Crown Cork & Seal Finance plc unit and the $184.25 million of outstanding 6¾% notes issued by its Crown Cork & Seal Finance SA subsidiary. The latter two series of notes are both scheduled to mature on Dec. 15.

Crown Cork said it would repurchase the 6¾% notes due April 15 at a cash price of 100.5% of their principal amount (i.e. $1,005 per $1,000 principal amount), and would repurchase the other three series at in cash at par. It said it would also pay all tendering holders accrued and unpaid interest up to, but not including, the settlement date.

The tender offers were made independently of one another, and the expiration deadline for all of them was set at 12:01 a.m. ET on March 5, subject to possible extension. Completion of the applicable tender offer would be subject to the satisfaction or waiver of various conditions, including the condition that Crown Cork's refinancing plan be consummated on terms satisfactory to the company.

On Feb. 11, Crown Cork was heard by high yield syndicate sources to have successfully sold approximately $2.1 billion of new dollar- and euro-denominated notes, with a portion of the deal proceeds expected to be used to finance the tender offers for the four series of its existing notes.

Sirius Satellite completes stock-for-debt exchange, recapitalization

Sirius Satellite Radio Inc. (Caa1) said on Wednesday (March 5) that 91% of its debt holders have agreed to exchange their debt for common stock, in a previously announced recapitalization that also exchanges the company's preferred stock for common stock, and that, additionally, will inject $200 million in new capital from its major financial partners into the company through the sale of newly-issued common stock.

The company said that holders of approximately 91% in principal amount of the company's debt tendered in the exchange offer, including the holders of 100% of its term loans, approximately 90% of its senior secured discount notes, approximately 85% of its senior secured notes and approximately 89% of its convertible subordinated notes. Holders of a majority of the company's debt agreed to reduce the previously announced minimum tender conditions. The exchange offer for the senior notes expired as scheduled at 5 p.m. ET on Tuesday (March 4), without extension.

Sirius said that upon completion of all transactions, which are expected to conclude this week, the recapitalization will convert approximately $636 million in debt and $519 million in preferred stock into common stock.

Separately, the company announced that what it termed "an overwhelming majority" of Sirius shareholders approved the recapitalization transactions at a special shareholders' meeting held on Tuesday in New York. Over 90% of stockholder votes cast were in favor of the transactions.

The dealer manager for the tender offer was UBS Warburg LLC. MacKenzie Partners, Inc. (call 212- 929-5500) was the information agent.

AS PREVIOUSLY ANNOUNCED: Sirius Satellite Radio, a New York-based satellite radio broadcasting company, said in an S-4 filing with the Securities and Exchange Commission on Nov. 20 that it would offer to exchange new shares of common stock for existing high yield bond debt, convertible debt and bank debt, and would solicit noteholder consents tp proposed indenture changes related to its overall recapitalization plan. The company said it would additionally solicit debtholder acceptances to a proposed pre-packaged plan of reorganization - something which the company described as "a fall-back position should it fail to convert the required number of bondholders during the recapitalization process." Sirius said that if the company decided to go that route, the pre-packaged plan would effect the same transactions contemplated by the recapitalization plan, including the issuance of common stock in exchange for the company's debt securities and preferred stock, as well as proposed new equity investment.

Sirius said it would offer a total of 596,669,765 common shares (representing approximately 62% of its outstanding common stock after giving effect to the restructuring) for the debt as a part of the overall recapitalization plan. It would offer the stock in exchange for its $280.43 million (face amount at maturity) of outstanding 15% senior secured discount notes due 2007, its $200 million of outstanding 14 ½% senior secured notes due 2009, its $16.461 million of outstanding 8¾% convertible subordinated notes due 2009, $150 million of Lehman Senior Term Loans and $50 million of Loral Senior Term Loans.

The company said that each holder of its debt securities would receive 779.5 shares of common stock per $1,000 of principal and accrued interest exchanged. Including accrued interest through March 15, 2003, current holders of the 15% discount notes would hold 23.7% of Sirius' common stock after the completion of the recapitalization, assuming 100% participation of holders of those notes; holders of the 14½% notes would hold 18.2% of the stock; holders of the 8¾% convertible notes would hold 1.4% of the stock; holders of the Lehman loans would hold 12.6% of the stock; and holders of the Loral loans would hold 6.1% of the stock, for an aggregate of 62% of the stock which will then be outstanding.

Concurrent with the consummation of the exchange offer, Sirius' said its outstanding preferred stock would be exchanged for common stock and certain investors would purchase common stock for $200 million cash. Sirius said that the restructuring would eliminate all or substantially all of its outstanding debt and all of its preferred stock and provide the company with sufficient cash to cover its estimated funding needs into the second quarter of 2004.

In connection with the exchange offer, Sirius said it was also soliciting the consent of its noteholders to the adoption of certain amendments to the notes' indentures and the waiver of any defaults or events of default under such indentures now in existence, if any, or caused by the recapitalization plan.

Consents from holders of a majority of the principal amount for each series of notes (principal amount at maturity for the discount notes)would be necessary to effect the proposed amendments and waivers.

Sirius said that under terms of its lockup agreement, holders of approximately 53% of the outstanding principal amount at maturity of its outstanding senior secured discount notes, approximately 60% of its outstanding senior secured notes and approximately 53% of its outstanding convertible subordinated notes agreed to tender their notes in the exchange offer and consent to the proposed amendments and waivers, thereby assuring that the proposed amendments and waivers would become effective in the event the exchange offer is completed.

Sirius said that if the recapitalization plan were to be completed and supplemental indentures executed, the proposed amendments and waivers would be binding upon non-tendering holders of notes, regardless of whether such holders consented to the proposed amendments and waivers.

It said that delivery of a properly completed and validly executed letter of transmittal would constitute delivery of a consent. Holders cannot tender notes in the exchange offer unless they also consent to the proposed indenture amendments and waivers.

The company said that completion of the exchange offer would be conditioned, among other factors, upon the company's receipt of valid tenders from at least 97% in aggregate principal amount of its outstanding debt securities and 90% in aggregate principal amount of its convertible subordinated notes; provided that the holders of a majority of its debt securities might reduce the minimum tender condition to not less than 90% in aggregate principal amount of Sirius debt securities and may lower or eliminate the minimum condition applicable to its convertible subordinated notes.

Completion of the exchange offer would also be conditioned upon the approval by its existing stockholders of the restructuring and receipt of any required consents or approvals from governmental authorities.

Sirius did not initially set an expiration deadline for the exchange offer. It said that the exchange offer would begin as soon as possible after the effective date of the registration Statement filed with the SEC. It said it expects to have the restructuring and recapitalization process completed no later than March 15, 2003.

On Jan. 30, Sirius announced that it would launch an offer on Friday (Jan. 31) to exchange shares of its common stock for all of its outstanding debt, essentially on the terms previously outlined, as part of the previously outlined recapitalization. Sirius said that the exchange offer and related consent solicitation would expire at 5 p.m. ET on March 4, subject to possible extension.

The company said that holders of approximately 79% in principal amount of Sirius' debt securities had already agreed to tender in the offer.

Sirius said that tendering holders would also be consenting to the adoption of certain amendments to the indentures under which the outstanding notes were issued to, eliminate substantially all of the restrictive covenants.

Concurrent with the exchange offer, the company was also soliciting votes to accept or reject a prepackaged plan of reorganization, which will attempt to accomplish the recapitalization on substantially the same terms as the out-of-court recapitalization in the event that the minimum tender condition to the exchange offer is not satisfied or waived.

Sovereign Bancorp completes tender for 8 5/8% and 10¼% '04 notes

Sovereign Bancorp, Inc. (Ba2) said on Wednesday (March 5) that it had successfully completed its previously announced tender offer for its outstanding 8 5/8% senior notes due in March, 2004 and 10¼% senior notes due in May, 2004.

The tender offer expired as scheduled at 5 p.m. ET on March 4, with no extension. As of that deadline, $139.2 million of the 8 5/8% notes and $162.4 million of the 10¼% notes had been tendered and not withdrawn. Sovereign accepted all validly tendered notes for purchase.

Salomon Smith Barney (call 212 723-6106 or toll-free at 800 558-3745) and Lehman Brothers (call 212 528-7581 or toll-free at 800 438-3242) were the dealer managers for the tender offer. Mellon Investor Services, LLC, was the depositary for the offer.

AS PREVIOUSLY ANNOUNCED, Sovereign, a Philadelphia-based bank holding company, said on Feb. 26 that it would begin a tender offer to purchase any and all of its $175 million of outstanding 8 5/8% notes and $200 million of 10¼% notes.

It said that the tender offer would begin at 9 a.m. ET on Feb. 26 and would terminate at 5 p.m. ET on March 4, subject to possible extension.

Sovereign said that the tender price would be $1,062.50 per $1,000 principal amount of 8 5/8% notes tendered and $1,091.25 per $1,000 principal amount of 10¼% notes tendered.

The company said that funding for purchasing notes tendered under the offer would be provided by a $120 million dividend made from the capital of the company's Sovereign Bank unit in the first quarter, and by an advance under Sovereign's credit facility with the Bank of Scotland.

Quest Diagnostics sets purchase price for Unilab 12¾% '09 notes

Quest Diagnostics Inc. (Baa3) said on Wednesday (March 5) ) that it had determined the price it will offer the holders of Unilab Corp.'s (B3) 12¾% senior subordinated notes due 2009 in its previously announced tender offer for those notes.

Quest said that the total consideration to be paid for each validly tendered note would be $1,229.64 per $1,000 principal amount of the notes tendered, based on a 50-basis point fixed spread over the yield of the applicable reference security - the 1.875% U.S. Treasury Note due Sept. 30, 2004 - as calculated at 2 p.m. ET on the pricing date, Tuesday (March 4). The total consideration includes a consent payment of $30 per $1,000 principal amount, payable to those holders who tendered their notes by the now-expired Feb. 26 consent deadline. Holders tendering after the consent deadline but before the offer expiration deadline on Thursday (March 6) would receive the tender offer consideration of $1199.64 per $1,000 principal amount (the total consideration mius the consent payment).

Payment for all validly tendered notes is expected to be made on Friday (March 7).

As of the 2 p.m. ET pricing deadline on March 4, 100% of the outstanding principal amount of the notes had been tendered.

Merrill Lynch & Co. (contact the Liability Management Group, at either 888 ML4-TNDR or 212 449-4914) will be the dealer-manager for the tender offer and the consent solicitation. The information agent is Georgeson Shareholder Communications Inc. (call toll-free at 866 283-1946; banks and brokerage firms call 212 440-9800). The depositary is HSBC Bank USA.

AS PREVIOUSLY ANNOUNCED: Quest Diagnostics, a Teterboro, N.J.-based provider of medical diagnostic testing, information and services, said on Feb. 6 that it had begun a cash tender offer for any and all of the outstanding $100.8 million principal amount of Unilab's 12¾% notes. The tender offer was begun in connection with Quest Diagnostics' previously announced agreement to acquire Unilab (Quest announced on Feb. 26, that it had acquired Unilab via a separate equity tender for Unilab's shares for $297 million in cash, plus 7.4 million Quest common shares).

Quest said the bond tender offer would expire at 12 midnight ET on March 6, subject to possible extension, and initially set 5 p.m. ET on Feb. 20 as the consent deadline, but subsequently extended it to 5 p.m. ET on Feb. 26; the consent solicitation portion of the offer expired as scheduled at that time without further extension.

The company said it would purchase the outstanding notes at a price to be determined two business days prior to the expiration date of the tender offer ([tentatively, March 4) using a formula based on a 50-basis point fixed spread over the yield to maturity of the reference security - the 1.875% U.S. Treasury Notes due Sept. 30, 2004 - at that time.

The purchase price would also include a $30 per $1,000 principal amount consent payment for those holders tendering their notes by the consent deadline. Quest said it was seeking the consent of the noteholders to certain proposed amendments to the notes' indenture, aimed at eliminating substantially all of the restrictive provisions of the indenture. It said that it would consider holders tendering their notes by the consent deadline to have agreed to the indenture changes, making them eligible to receive the consent payment. It further said that tendered notes could not be withdrawn and consents could not be revoked after the end of the consent period.

All tendering holders will also receive accrued and unpaid interest on their notes. Payment for validly tendered notes is expected to be made promptly following the expiration of the tender offer. Quest plans to finance the tender offer with a combination of cash on hand and borrowings under a $450 million amortizing term loan facility.

The company said the tender offer would be subject to a number of conditions and contingencies, including the successful completion of the acquisition of Unilab by Quest Diagnostics and the now-fulfilled requirement of receipt of consents from a majority of the outstanding noteholders.

On Feb. 27, Quest said that it had received the requisite amount of consents to the proposed indenture changes from the Unilab noteholders. It said that as of the now-expired consent deadline for the offer at 5 p.m. ET on Feb. 26, it had received consents from the holders of $100.8 million principal amount of the notes, or 100% of the outstanding amount, allowing the tender offer to continue.

Dobson Communications bought back 12¼% notes, also preferreds

Dobson Communications Corp. (B3) said Wednesday (March 5) that it had bought back $11.5 million principal amount of Dobson/Sygnet 12¼% senior notes due 2008 during the 2002 third quarter, at a cost of $8.9 million. Dobson/Sygnet issued $200 million of the notes in December 1998. Dobson did not say what amount remains outstanding at present.

Dobson, an Oklahoma City-based provider of cellular service to rural markets, also said in its earnings release for the fourth quarter ended Dec. 31 that from the inception of its preferred stock repurchase program to date, Dobson has repurchased a total of approximately $168 million (liquidation preference) of its preferred stock. Of this amount, the company repurchased $41.1 million in the third quarter, $66.6 million in the fourth quarter, and $59.9 million in the (current) first quarter, at a cost of $10.9 million, $27.8 million and $36.4 million, respectively.

Dobson said in a filing with the Securities and Exchange Commission on Tuesday (March 4) that the preferred stock purchases carried out through this past Friday (Feb. 28) consisted of a total of 71,639 shares of its 12-¼% senior exchangeable preferred stock having an aggregate liquidation preference amount of $71.7 million, bought for an aggregate purchase price of $31.7 million, and 95,960 shares of its 13% senior exchangeable preferred stock due 2009 having an aggregate liquidation preference amount of $96 million, for an aggregate purchase price of $43.5 million.

All of the repurchased shares have been retired and returned to authorized, but unissued, shares of preferred stock, without designation.

Dobson said in the earnings release that its fourth-quarter results reflect the cancellation of the $107.7 million in preferred stock that was repurchased prior to the end of 2002, along with $1.3 million in dividends. The effects of the $59.9 million in preferred stock that was repurchased in this year's first quarter will be reflected on the March 31 balance sheet when Dobson reports its first quarter results.

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