Photronics buys back $33.2 million 6% convertibles

New York, Sept. 19 - Photronics, Inc. said it bought back $33.2 million of its 6% convertible subordinated notes (B2/B) at a discount.

The Brookfield, Conn. photomasks company paid a total of $30.8 million for the securities, an average $927 per $1,000 principal amount.

"Photronics is deeply committed to strengthening its balance sheet and generating value for its shareholders," said Sean T. Smith, chief financial officer, in a news release. "The discount at which we were able to repurchase these notes represents an excellent opportunity to achieve both these ends.

"The reduction of our long-term debt and interest carrying costs are a critical part of this management team's broader strategy to reduce the overall cost of capital and improve the company's position to generate increasing levels of free cash flow in the near future."

Photronics used working capital to finance the buy-back, which it expects to save $2 million in interest payments per year.

The notes convert at $27.98 per share. Its stock closed at $10.70 on Thursday.

Photronics said it may buy back additional notes if it considers the prices attractive.

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