Inergy launches cash tender for 6 7/8% notes, 8¾% notes, 8¼% notes

By Jennifer Chiou

New York, Jan. 19 - Inergy LP announced the start of a cash tender offer for any and all of the following notes:

• $425 million of 6 7/8% senior notes due 2014;

• 8¾% senior notes due March 1, 2015; and

• $400 million of 8¼% senior notes due 2016.

Upon the completion of the pending redemption of $78.75 million of the 8¾% notes, $146.25 million is expected to be outstanding on Feb. 4.

The company is also soliciting consents to some amendments that would eliminate most of the covenants and some default provisions contained in the indentures of the 6 7/8% notes as well as the 8¼% notes. The 8¾% notes are not involved in the consent solicitation.

The offer will end at 8 a.m. ET on Feb. 16.

For each $1,000 principal amount, Inergy will pay a total consideration of $1,025.42 for the 6 7/8% notes, $1,087.50 for the 8¾% notes and $1,045 for the 8¼% notes.

Those who tender prior to 5 p.m. ET on Feb. 1 will receive the $25.00 consent payments included in the payouts for the 6 7/8% notes and 8¼% notes. Those who tender by that early tender deadline will obtain the $30.00 early tender payment included for the 8¾% notes.

Holders may not tender their notes without delivering consents and vice versa for notes involved in the solicitation.

The offer is conditioned on sufficient financing, the receipt of consents from holders of a majority of notes and other customary conditions.

Early settlement for the notes is expected to occur on Feb. 2 for notes involved in the solicitation and on Feb. 7 for the 8¾% notes.

In addition, if the offer for the 6 7/8% notes and 8¼% notes is successful, Inergy said it intends to exercise its right, when permitted by the indentures, to redeem the notes.

Bank of America Merrill Lynch is the dealer manager (888 292-0070 or call collect 980 388-9217). D.F. King & Co., Inc. is the depositary and information agent (800 431-9643 or 212 269-5550 for banks and brokers).

Inergy is a Kansas City, Mo.-based energy infrastructure and distribution company.

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