Constellation Brands calls 8½% notes

New York, Feb. 10 - Constellation Brands Inc. said it will redeem its $200 million of 8½% senior subordinated notes due 2009 on March 11.

The Fairport, N.Y., producer and marketer of alcoholic beverages will pay 103.25% of par plus accrued interest up to the date of redemption.

Constellation will fund the redemption with cash and borrowings under its revolving credit facility.

"The economics of calling these notes are compelling," said Constellation chief financial officer Thomas Summer in a news release. "[With] Constellation's strong cash flow we have more than sufficient liquidity and financial flexibility to repay the notes. We expect the transaction to be cash flow positive in year one even after taking into account the call premium."

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