Rhodia to redeem $145 million notes now, $145 million in June

New York, Feb. 13 - Rhodia said it has reached agreement with investors holding $290 million of its notes issued in 2002 to redeem half of them now and half in June.

Under the agreement, the Paris specialty chemicals company will redeem $145 million of the notes in February and $145 million on June 30.

In both cases Rhodia will pay accrued interest and a premium as required under the terms of the notes.

Rhodia described the redemption as another step in its debt refinancing plan following the agreement in December to extend its bank facilities.

Rhodia issued the notes in July 2002 when it was still investment-grade rated. It sold them as $215 million of 7¾% guaranteed senior unsecured notes due July 30, 2009 and $75 million of 8.2% guaranteed senior unsecured notes due July 30, 2012.

Following the company's downgrade to junk in February 2003, the interest rate stepped up to 9% and 9.45% respectively.

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