Punch Taverns planning tender offer for 5% convertibles due 2010

By Angela McDaniels

Tacoma, Wash., June 15 - Punch Taverns plc plans to make a tender offer for any and all of the £275 million of 5% convertible bonds due Dec. 14, 2010 issued by Punch Taverns (Redwood Jerseyco) Ltd., according to a company news release.

The offer price is expected to be at least 95% of par.

Proceeds from a £350 million offering of ordinary shares will be used to fund the tender offer.

The company said that given the difficult trading environment, its key objectives have been to increase cash flow and reduce debt levels to allow it to repay the convertibles at or prior to maturity and to repurchase securitization notes at a discount to par, which assists in providing covenant headroom under the securitizations.

Punch Taverns is a pub company based in Burton on Trent, England.

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