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Tempur-Pedic completes partial redemption of 10¼% notes
New York, Jan. 26 - Tempur-Pedic International Inc. said that its Tempur-Pedic, Inc. and Tempur Production USA, Inc., subsidiaries (B3/B-) had completed the previously announced redemption of $52.5 million of their 10¼% senior subordinated notes due 2010 using part of the proceeds from the parent company's recent initial public equity offering.
The two Tempur-Pedic units sold $150 million of the notes in August 2003. Terms included an equity clawback provision to repurchase up to 35% of the issue, or $52.5 million, using proceeds from any equity sale. The redemption price was 110.25% of the principal amount plus accrued interest, the specified equity clawback price.
The company expects to reflect the approximately $5.4 million redemption premium as a transaction related expense in the first quarter of 2004.
As previously announced, Tempur-Pedic International, a Lexington, Ky.-based maker of mattresses and pillows, said on Dec. 23 that its Tempur-Pedic, Inc. and Tempur Production USA, Inc., subsidiaries had begun an optional redemption of $52.5 million of the 10¼% notes, which would be funded from a portion of the proceeds of the parent's just-completed IPO. The company concurrently announced on Dec. 23 the official closing of the IPO in which it sold 6.25 million shares at $14 per share, for total net proceeds to the company, before transaction costs, of $81.81 million. Additional shares were sold by certain stockholders.
Tempur-Pedic set a redemption date of Jan. 23, and said the notes would be redeemed at a redemption price of 110.25% of the principal amount to be redeemed, plus accrued and unpaid interest.
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