HudBay subsidiary tenders for any and all 9 5/8% notes

By Jennifer Chiou

New York, Nov. 22 - HudBay Minerals Inc. announced that its wholly owned subsidiary, Hudson Bay Mining and Smelting Co., Ltd., began a cash tender offer for any and all of its $45.1 million of 9 5/8% senior secured notes due 2012.

The Toronto-based integrated mining and metal producing company is also soliciting consents to amend the indenture governing the notes in order to eliminate most of the restrictive and affirmative covenants and certain events of default.

The consent deadline is 5 p.m. ET on Dec. 6. The offer ends at midnight ET on Dec. 20.

"The tender offer represents a continuation of our previously announced intention to repurchase the notes," chief executive officer Peter Jones said in a news release.

"We believe it is beneficial to shareholders to utilize our available cash to repurchase the balance of the outstanding notes and reduce our overall leverage."

For each $1,000 principal amount, the company said it will pay the yield to the first redemption date for the notes on Jan. 15, 2009, discounted using the bid-side yield of the 3.25% Treasury due Jan. 15, 2009 and 50 basis points.

The payout includes a $30.00 consent payout for those who tender before the early deadline.

Hudson Bay said it will also pay accrued interest to the payment date.

Credit Suisse Securities (USA) LLC is the dealer manager and solicitation agent (800 820-1653 or call collect 212 538-0652). Global Bondholder Services Corp. is the information agent and depositary (866 470-4300 or call collect 212 430-3774).

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