Rural/Metro accepts tenders for 96.8% of 9 7/8% notes, plans to call remainder in March

By Jennifer Chiou

New York, Dec. 10 - Rural/Metro Corp. said it accepted tenders from holders of $121 million, or 96.8%, of its 9 7/8% senior subordinated notes due 2015.

The offer wrapped at 5 p.m. ET on Dec. 8. It was previously extended from midnight ET on Dec. 7.

The company said it intends to redeem any remaining notes in March.

The offer was made through Rural/Metro Operating Co., LLC and Rural/Metro (Delaware) Inc. and began on Nov. 6.

Rural/Metro paid $1,074.14 per $1,000 principal amount of notes tendered in the offer.

The purchase price was determined at 2 p.m. ET on Dec. 3 based on a fixed spread of 50 basis points over the yield to maturity on the 4% U.S. Treasury note due March 15, 2010.

The payout included a $20.00 premium for each note tendered by the consent date, which was 5 p.m. ET on Nov. 20. Holders also received accrued interest up to but excluding the payment date.

Rural/Metro received the needed consents to amend the notes to eliminate or modify substantially all of the restrictive covenants and events of default contained in the indenture.

Holders who tendered their notes were required to consent to the proposed amendments and vice versa.

This total tender amount was unchanged from Nov. 23, when the company first said it had received enough consents to make the proposed amendments.

The tender offer and the consent solicitation were contingent upon the tender of at least a majority of the outstanding principal amount of the notes and the refinancing of the company's credit facility due 2011.

The company also said it has finalized its new senior secured credit facility and will use borrowings under the new credit facility, in addition to roughly $18.3 million of cash, to finance its tender offer.

RBC Capital Markets was the dealer manager and solicitation agent.

Rural/Metro is a Scottsdale, Ariz.-based provider of private ambulance and fire services.

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