AnnTaylor calls convertibles

New York, May 20 - AnnTaylor Stores Corp. Inc. said it will redeem all $199.072 million principal amount at maturity of its convertible subordinated debentures due 2019 on June 18.

The New York women's retailer will pay $635.42 per $1,000 principal amount.

Holders are expected to convert the notes into 5.4 million shares of common stock, AnnTaylor said. The figure is adjusted for a three-for-two stock split scheduled for May 26.

"The anticipated conversion of the convertible notes into shareholders' equity is in line with the company's strategy of strengthening its financial structure," said chairman Patrick Spainhour in a news release.

"This anticipated conversion will reduce the company's annual interest expense by approximately $4.5 million but will have no impact on fully diluted earnings per share."

AnnTaylor stock closed at $40.49 Thursday.

The convertibles were issued in 1999. They pay a 0.55% coupon and accrue interest at 3.75% in total. The conversion ratio pre-split is 18.117.

June 18, 2004 is the first call date of the securities.

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