Foster Wheeler to redeem 10.359% notes, 9% trust preferreds as part of debt reduction

By Angela McDaniels

Seattle, April 25 - Foster Wheeler Ltd. will exchange 1,277,900 new common shares for $50 million of its 10.359% senior secured notes due 2011 on April 27, according to a company news release.

The company will then redeem the remaining $61.5 million of the 10.359% notes on May 25 and the $6 million outstanding principal amount of its 9% trust preferred securities on May 26.

The redemption price for the 10.359% notes and 9% trust preferreds will be the make-whole price and $25 per trust preferred, respectively, plus accrued interest to the redemption date.

These transactions, which will eliminate $121.6 million of debt (including unamortized premium), will complete the company's debt reduction program. Total remaining debt will be at its lowest level in more than 20 years and will be comprised almost entirely of limited-recourse project debt and capitalized lease obligations, according to the release.

All of these transactions are accretive to expected 2006 earnings per share, excluding related one-time accounting charges.

The company said it will continue to consider the repurchase or redemption of its remaining debt using excess cash from operations.

Foster Wheeler is a Hamilton, Bermuda-based company that provides engineering and construction services to the energy industries.

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