RailAmerica settles oversubscribed offer for $444 million 9¼% notes

By Susanna Moon

Chicago, March 1 - RailAmerica, Inc. said it wrapped the over-subscribed tender offer for its outstanding 9¼% senior secured notes due 2017 that ended at midnight ET on Feb. 29.

Funding for the offer will come from a new $585 million seven-year credit facility, which closed March 1, according to a company press release. Interest on the loans is Libor plus 300 basis points, with a 1% Libor floor, and the facility was issued at 99.5.

The company said on Feb. 14 that holders had tendered $513 million of the notes in the cash offer to purchase up to $444 million of the notes.

RailAmerica previously said it planned to accept the tendered notes on a pro rata basis.

The company paid $1,120, including a $30 early tender payment, for each $1,000 principal amount of notes tendered by the early deadline, 5 p.m. ET on Feb. 14.

RailAmerica also paid accrued interest.

Citigroup was the dealer manager (800 558-3745 or call collect 212 723-6106). Global Bondholder Services Corp. was the depositary and the information agent (866 794-2200 or call collect 212 430-3774).

Jacksonville, Fla.-based RailAmerica owns and operates short-line and regional freight railroads in North America. It launched the tender on Feb. 1.

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