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Ardagh Glass to unwind $1.6 billion bonds, as regulatory snags delay Verillia acquisition
By Paul A. Harris
Portland, Ore., Jan. 13 - Ardagh Packaging Finance plc and Ardagh Holdings USA Inc. announced in a Monday press release that they will use escrowed proceeds to buy back about $1.5 billion equivalent of high-yield notes from investors.
The buyback was triggered by the passage of the closing date for Ardagh's acquisition of the Verallia North America glass container manufacturing operations from Cie. de Saint-Gobain SA.
Ardagh said it has arranged to replace the bond proceeds with committed replacement bridge financing, which it expects to refinance in the capital markets in due course.
Antitrust negotiations
Ardagh is currently negotiating a settlement of an antitrust complaint related to the acquisition with the U.S. Federal Trade Commission (FTC), according to the release.
Under negotiation are proposals that involve Ardagh divesting six former Anchor Glass plants together with the former Anchor headquarters and infrastructure at Tampa, Fla.
The settlement negotiations with the FTC are progressing satisfactorily, the release stated. However, it has not proven possible to conclude the negotiations in time for Ardagh to complete the acquisition of Verallia North America by Jan. 13, 2014, thus triggering the early repayment of the bonds with the escrowed proceeds.
To enable the settlement negotiations with the FTC to be concluded and the acquisition to proceed, Ardagh and Saint-Gobain have agreed to extend the final closing date under the share purchase agreement to April 30, 2014 from Jan. 13, 2014.
All of the bonds being unwound came in three-part deal that priced on Jan. 16, 2013, when the company sold $420 million of 4 7/8% secured notes due Nov. 15, 2022, €250 million of 5% secured notes due Nov. 15, 2022 and $850 million of 7% unsecured notes due Nov. 15, 2020.
Ardagh is a Dublin, Ireland-based supplier of glass and metal packaging.
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