Interliant achieves 99.6% participation in convertibles exchange

New York, Dec. 14 - Interliant, Inc. said it accepted tenders of $37.5 million of its 7% convertible subordinated notes in the public portion of its debt exchange. Added to the private exchange of $126.8 million previously negotiated with holders, the Purchase, N.Y. company said it achieved a 99.6% participation rate.

Each $1,000 principal amount of the notes will be exchanged for $270 of senior notes convertible into 270 shares of Interliant common stock, warrants for 67.50 shares at an exercise price of $0.60 per share and $70.00 in cash. Both public and private portions are on the same terms.

The offer, which had been extended, expired at 5.00 p.m. on Dec. 13.

Interliant, a global application service provider, expects to close the private transaction by Dec. 31, 2001.

Together, the exchanges will reduce the company's outstanding notes by $120 million.

"The successful execution of this exchange offer and the expected closing of the private transaction later this month will dramatically improve our balance sheet," said Frank Alfano, Interliant's chief financial officer, in a news release. "This is a big step toward financial stability for Interliant, and I believe it will positively impact our core business growth through EBITDA breakeven."

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