GEO Group terminates consent solicitation for 8¼% notes

By Jennifer Chiou

New York, Dec. 14 - The GEO Group, Inc. is no longer proceeding with the consent solicitation for its 8¼% senior unsecured notes due to a change in its plan to fund the proposed acquisition of CentraCore Properties Trust.

The solicitation began on Nov. 15. It was set to expire at 5 p.m. ET on Nov. 29.

GEO will also no longer follow through with a $275 million private placement of senior secured notes.

Instead, the company said it will increase borrowings under an amended senior secured credit facility by $365 million, adding it will use about $50 million of cash on hand.

Under the terms of the definitive agreement, CentraCore shareholders will receive $32.00 cash per common share or $356.1 million, and GEO will refinance CentraCore's debt at closing, which is estimated to be $40 million.

GEO previously said that the acquisition financing would be comprised of $57 million in cash and $360 million in debt.

Closing of the acquisition is expected in late 2006 or early 2007. It is subject to regulatory and shareholder approvals but not to financing conditions.

BNP Paribas (866 491-7302) is the solicitation agent as well as the lead bank for the credit facility.

GEO is a Boca Raton, Fla., provider of correctional and mental health services. CentraCore is a Palm Beach Gardens, Fla., correctional real estate investment trust.

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