Harbinger 7 7/8% notes exchange oversubscribed by early deadline

By Marisa Wong

Madison, Wis., May 29 - Harbinger Group Inc. said that holders tendered $407,299,000, or about 44%, of its outstanding 7 7/8% senior secured notes due 2019 as of 5 p.m. ET on May 28, the early tender time of its previously announced exchange offer.

Harbinger is offering to exchange a portion of the outstanding 7 7/8% notes for up to $350 million principal amount of new 7¾% senior notes due 2022, which will be in addition to the $200 million 7¾% senior notes due 2022 issued in January.

Because the offer was oversubscribed, the company accepted for exchange tendered notes on a prorated basis. The proration factor was about 78.73%, according to a press release.

Holders will receive $1,091.71 principal amount of new notes for each $1,000 principal amount of old notes tendered, subject to the tender cap. The amount includes an early tender payment of $50.00 principal amount of 7¾% notes for each 7 7/8% note tendered by the early tender time.

The company will also pay accrued interest up to but excluding the settlement date.

The company said it expects to have $604.4 million of the 7 7/8% notes and $550 million of the 7¾% outstanding after settlement of the exchange offer on May 30.

The exchange offer will end at 11:59 p.m. ET on June 11, but the company will not accept any notes tendered after the early tender time.

Harbinger began the exchange offer and a consent solicitation for the 7 7/8% notes on May 14.

As reported on May 23, the company secured consents from holders of a majority of the 7 7/8% notes to proposed amendments to the notes' indenture that provide the company with greater flexibility to repurchase or redeem its outstanding common stock.

D.F. King & Co., Inc. (800 431-9633) is the information agent and the exchange agent for the exchange offer, and Wells Fargo Bank, NA (917 260-1550 or 612 667-0337) is the tabulation agent for the consent solicitation.

Harbinger Group is a diversified holding company based in New York City.

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